Delhi District Court
Amit Soni vs Manoj Kumar on 21 December, 2023
IN THE COURT OF BHUJALI,
M.M. - 01, (N. I. ACT), CENTRAL DISTRICT,
TIS HAZARI COURTS, DELHI.
JUDGMENT
Amit Soni ................................. .....................................Complainant Versus Manoj Kumar....................................................................................Accused
a) Unique/new case number : 512538/2016
b) Name of complainant : Amit Soni
c) Name of accused person(s) :Manoj Kumar S/o Sh. Hari Prasad R/o H648, Gali No. 100 (near Mount Alivet school) Sant Nagar, Burari, Delhi 110084
d) Offence complained of : Under Section 138 of N. I. Act,1881
e) Plea of accused person(s) : Pleaded not guilty
f) Final order : Convicted
g) Date of such order : 21.12.2023 BRIEF STATEMENT OF THE REASONS FOR THE DECISION (As mandated u/s 355 (i) of the Code of Criminal Procedure, 1973.) Case of the complainant
1. The present Judgment is a result of culmination of trial initiated on the complaint filed by the complainant alleging that in April, 2014, accused asked to the complainant for a friendly loan of Rs. 1,50,000/ as he need this amount for his business purpose. Even prior to this he used to take friendly loan from the complainant and return that to the complainant. The accused promised to complainant he would return the said loan amount within a month. On 10.08.2014, accused gave a written assurance under section 4 of the Negotiable Instruments Act, 1881 to return Rs. 1,50,000/ to the complainant. In the month of August accused again asked for Amit Soni Vs. Manoj Kumar page no. 1 loan of Rs. 16,000/ to complainant as he needed more money for his business. Complainant this time again, gave him the said money. In discharge of abovesaid liability the accused person had issued two account payee post dated cheques bearing no. 000038, dated 10.10.2014, of Rs. 1,50,000/ and cheque bearing no. 000035, dated 08.10.2014, of Rs. 16,000/, both drawn on HDFC Bank, Gurgaon, branch Haryana (hereinafter referred to as cheques in dispute). The cheques when presented for payment were dishonored with remarks, "Funds Insufficient", after which, a legal demand notice dated 20.10.2014, was sent to the accused. Since, the legal demand notice went unheeded, the complainant was constrained to file the present case. The complainant examined herself as CW1 and tendered affidavit Ex. CW1 and documents Ex. CW1/1 to Ex. CW1/10.
The Defence
2. On the other hand, the accused in his plea of defence recorded on 18.12.2019, pleaded not guilty and claimed trial and took the defence that the cheques in dispute were given by him to the complainant as blank signed security cheques. The accused stated that the complainant had never given any loan to him. He stated that the complainant and him used to deal in stock market and he used to deposit the cash given by the complainant in his deemat account to invest in shares. He admitted his signatures on the cheques but stated that he do not owe any liability towards the complainant.
The Law This, in sum and substance, is that factual position in the present case. To bring home the guilt of the accused, the complainant has to prove beyond reasonable doubt elements of Section 138 Negotiable Instrument Act by crossing the following legal benchmarks.
a) The cheque was drawn by drawer on an account maintained by him with the banker for payment of any amount of money out of that account to the complainant.
Amit Soni Vs. Manoj Kumar page no. 2
b) The said payment was made for discharge of a legally enforceable debt
or other liability, in whole or in part.
c) The said cheques were returned unpaid by the bank.
d) The cheques were presented to the bank within a period of three months
from the date on which it was drawn or within the period of its validity whichever is earlier.
e) The payee or the Holder in due course of the cheques as the case may be made a demand for the payment of the said amount of money by giving the notice in writing to the drawer of the cheques within 30 days of the receipt of information by him from the bank regarding the return of the cheques as unpaid.
f) The drawer of the cheque fails to make the payment of the said amount of money to the payee or as the case may be the Holder in due course of the cheques within 15 days of the receipt of the said notice.
Appreciation of Evidence and Application of the law to the facts of present case
(i) Issuing of Cheque in favour of Complainant
5. The first ingredient of offence u/s 138 N.I.Act which has to be established by the complainant is that the cheque(s) in dispute were drawn by the accused on an account maintained by him with his banker and was given to the complainant. To that effect, complainant as CW1 deposed through her affidavit to discharge his liability the accused had issued two account payee post dated cheques bearing no. 000038, dated 10.10.2014, of Rs. 1,50,000/ and cheque bearing no. 000035, dated 08.10.2014, of Rs. 16,000/, both drawn on HDFC Bank, Gurgaon, branch Haryana (Ex. CW1/1 & Ex. CW1/2) from his bank account.
The accused in his plea of defence recorded on 18.12.2019, admitted his signatures on the cheques but stated that he do not owe any liability towards the complainant and took the defence that the cheques in dispute were given by him to the complainant as blank signed security cheques.
Although, the accused has admitted his signatures on the cheque but he denied Amit Soni Vs. Manoj Kumar page no. 3 having filled other particulars. However, this defence of the accused is not tenable because no law requires that all the columns must be filled in by he drawer/maker himself. If signature on the cheque is admitted, the same will be sufficient. Concept of blank signed cheque is virtually immaterial in view of several judgment of Hon'ble High Court of Delhi viz. Ravi Chopra Vs. State And Anr. 2008 (2) JCC (NI) 169 and Vijender Singh Vs M/s Eicher Motors Limited & anr. Crl. M.C.No. 1454/2011 decided on 05.05.2011.
As per the scheme of the NI Act, once the accused admits signature on the cheque in question, certain presumptions are drawn, which result in shifting of onus on the accused.
Thus, it has been established that the cheque in dispute was drawn by the accused on his account maintained by him with his banker and were given to the complainant.
(ii) Presentment and Dishonour of Cheque(s)
6. The next ingredient to be proved by the complainant is that when the cheque in dispute was presented for encashment, it was returned by the bank unpaid. Complainant as CW1 has deposed in his affidavit that cheques in dispute were presented for encashment but the same were dishonored due to "Insufficient Funds"
in the account of the accused. To substantiate his deposition CW1 has brought on record original Cheques (Ex. CW1/1 & Ex. CW1/2), original returning memos (Ex. CW1/3, Ex. CW1/4). The genuineness of the same has not been disputed by the accused in his statement recorded on 18.12.2019.
Therefore, the factum of presentment of cheque within its period of validity and the factum of its dishonor stands established.
(iii) Legal Demand Notice
7. The next ingredient to be proved by the complainant is that after the dishonor of the cheque, a legal demand notice was sent to the accused person within statutory period of 30 days of the receipt of information about dishonor of cheque and that the Amit Soni Vs. Manoj Kumar page no. 4 accused failed to make payment of the cheque amount within 15 days of the receipt of the said notice. The legal demand notice Ex. CW1/5 have been placed on record.
The accused in his plea of defence has stated that he did not receive the legal demand notice. The accused also stated that the address mentioned on the legal demand notice is not correct as his address also bears a khasra number, which is not mentioned on the legal demand notice.
During the cross examination of the complainant as CW1 recorded on 05.03.2022 the accused also confronted then complainant with Ex. CW1/D1 and Ex. CW1/D2 i.e. the copy of Aadhar Card and Voter ID to show that the Address of the accused also includes the Khasra Number.
The counsel for the accused has raised the argument that the accused has not received the legal demand notice which is fatal to the case of the complainant. However the argument of the counsel of the accused is not sustainable. The primary purpose of the legal demand notice is to protect the honest drawer. The moment a cheque is dishonored, it cannot be presumed that the drawer is dishonest. There may be genuine reasons for the return of the cheque. Therefore, it is necessary to bring the factum of dishonour to the notice of the drawer so that, he can rectify his omission or commission avoiding the payee resorting to criminal prosecution as was also held in (1999) 8SCC 221 - Central Bank of India Vs. Saxons Farms. Object and purpose for which proviso to Section 138 was enacted, namely, to avoid unnecessary hardship to an honest drawer of a cheque and to provide him an opportunity to make amends.
The entire purpose of requiring a notice is to give an opportunity to the drawer to pay the cheque amount within 15 days of service of notice and thereby free himself from the penal consequences of Section 138. In Vinod Shivappa [D. Vinod Shivappa Vs. Nanda Belliappa (2006) 6 SCC 456:
(2006) 3 SCC (Cri) 114] the Court observed: (SCC p. 462, para 13) "One can Amit Soni Vs. Manoj Kumar page no. 5 also conceive of cases where a wellintentioned drawer may have inadvertently missed to make necessary arrangements for reasons beyond his control, even though he genuinely intended to honour the cheque drawn by him. The law treats such lapses induced by inadvertence or negligence to be pardonable, provided the drawer after notice makes amends and pays the amount within the prescribed period. It is for this reason that Clause (c) of proviso to Section 138 provides that the section shall not apply unless the drawer of the cheque fails to make the payment within 15 days of the receipt of the said notice. To repeat, the proviso is meant to protect honest drawers whose cheques may have been dishonoured for the fault of others, or who may have genuinely wanted to fulfill their promise but on account of inadvertence or negligence failed to make necessary arrangements for the payment of the cheque. The proviso is not meant to protect unscrupulous drawers who never intended to honour the cheques issued by them, it being a part of their modus operandi to cheat unsuspecting persons."
It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is no stipulation of giving of a notice before filing a complaint. Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the GC Act and Section 114 of the Evidence Act. Any Amit Soni Vs. Manoj Kumar page no. 6 other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskaran case [K.Bhaskaran Vs. Sankaran Vaidhyan Balan (1999) 7 SCC 510: 1999 SCC (Cri) 1284] if the "giving of notice" in the context of Clause (b) of the proviso was the same as the "receipt of notice" a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of Section 138 of the Act."
Coming to the facts of the present case, the notice dated 20.10.2014 having been sent vide postal receipt dated 21.10.2014 addressed to the accused as "
Mr. Manoj Kumar, S/o Sh. Hari Prasad, R/o - H648 , Gali No. 100 (Near Mount Alivet School) Sant Nagar, Burari. Delhi - 110084. Mob : +91 9891020427". However the accused has argued that the address is incorrect as the khasra number is not mentioned. Perusal of Ex. CW1/D1 and Ex. CW 1/D2 i.e. the copy of Aadhar Card and Voter ID to show that the Address of the accused also includes the Khasra Number in these documents. However, the accused has himself been giving the same address without mentioning the Khasra Number in the court during the trial. Perusal of bail bond dated 23.04.2022 furnished by the accused, the accused has himself stated his address without the Khasra Number. Similarly in the personal bond dated 12.02.2021 , the accused has himself stated his address without the Khasra Number, and has also mentioned his mobile number as 9891020427. The address mentioned in these bail bonds is the same as has been mentioned on the legal demand notice and thus points to the conclusion that the said address mentioned on the legal demand notice , albeit without the khasra number is also the correct address of the accused.
Additionally, during the trial several times summons and warrants against the accused were sent to the address mentioned on the legal demand notice. NBWs issued against the accused for date 20.12.2018 were addressed to the Amit Soni Vs. Manoj Kumar page no. 7 said address mentioned on the legal demand notice , without mentioning the khasra number, still the process server was able to reach the address wherein as per report dated 18.12.2018, the family of the accused was found residing at the said address and the mother of the accused gave her statement that ' bete ko bedhakal kar rakha hai'.
NBWs issued against the accused for date 20.01.2023 were addressed to the said address mentioned on the legal demand notice, without mentioning the khasra number, still the process server was able to reach the address wherein as per report dated 19.01.2023, the wife of the accused was found at the said address .
Thus in view of the bail bonds furnished by the accused and also the reports of the processes issued at the said address mentioned on the legal demand notice, it cannot be said that the said address mentioned on the legal demand notice is incomplete or incorrect so as to be fatal to the case of the complainant.
Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement "refused" or "not available in the house" or "house locked" or "shop closed" or "addressee not in station", due service has to be presumed. (Vide Jagdish Singh v. Natthu Singh [(1992) 1 SCC 647 : AIR 1992 SC 1604] ; State of M.P. v.
Amit Soni Vs. Manoj Kumar page no. 8 Hiralal[(1996) 7 SCC 523] and V. Raja Kumari v. P. Subbarama Naidu [(2004) 8 SCC 774: 2005 SCC (Cri) 393].) It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved.
The Apex Court in the case of C.C.Alavi Haji Vs. Palapetty Muhammed and another, reported in (2007) 6 SCC 555. The Apex Court in the said case has enunciated the presumption under Section 114 of the Evidence Act and Section 27 of the General Clauses Act. The relevant paragraphs of the aforesaid decision are quoted hereinbelow: "13. According to Section 114 of the Act, read with Illustration (f) thereunder, when it appears to the court that the common course of business renders it probable that a thing would happen, the court may draw presumption that the thing would have happened, unless there are circumstances in a particular case to show that the common course of business was not followed. Thus, Section 114 enables the court to presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business in their relation to the facts of the particular case. Consequently, the court can presume that the common course of business has been followed in particular cases. When applied to communications sent by post, Section 114 enables the court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. But the presumption that is raised under Section 27 of the GC Act is a far stronger presumption. Further, while Section 114 of the Evidence Act refers to a general presumption, Section 27 refers to a specific presumption. For the sake of ready reference, Section 27 of the GC Act is extracted below:
"27. Meaning of service by post.Where any Central Act or Regulation made after the commencement of this Act authorities or requires any document to be served by post, whether the expression 'serve' or either of the expression 'give' or 'send' or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, prepaying and posting by registered post, a letter containing the document, Amit Soni Vs. Manoj Kumar page no. 9 and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post."
Therefore, in such circumstances presumption under section 114 of Evidence Act and Section 27 of General Clauses Act can be raised to the effect that the notice was duly served upon the accused. When the notice is sent by registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of Clause (b) of proviso to Section 138 of the Act stands complied with. Needless to emphasize that if any accused wants to contend that she or he has not received the legal demand notice, such accused is at liberty to make the payment of cheque within 15 days from the service of summons as held by three judges bench of Hon'ble Supreme Court in C.C Alvi Haji Vs. Palapetty Muhammed and another (2007) 6 SCC 555 wherein it has been held as under: "Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the Court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons(by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court alongwith the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act, and Section 14 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation."
8. Admittedly, accused did not make the payment of cheque amount within 15 days of receipt of the demand notice and therefore cause of action against the accused arose and the present complaint was filed well within the limitation period.
Amit Soni Vs. Manoj Kumar page no. 10
(iv) Legally Enforceable Debt or other Liability Presumption
9. Once the fundamental ingredients which gives rise to cause of action u/s 138 N.I.Act have been established a mandatory presumption u/s 139 of N.I.Act, is effected in favour of complainant and it also extends to the existence of legally enforceable liability itself.
10. A three judged bench of Hon'ble Supreme Court in Rangappa Vs. S.Mohan (2010) 11 SCC 441 has held that:
"In the light of these extracts, we are in agreement with the respondentclaimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable dept or liability. To the extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way caset doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours the complainant.
11. Since in the present case, the complainant has successfully established that the cheques in dispute were issued by the accused and the same got dishonored and the accused failed to make the payment even after service of statutory notice, a presumption u/s 139 N.I.Act is drawn in favour of the complainant to the effect that the cheque in dispute was issued by the accused for a legally enforceable debt.
(v) Rebuttal of Presumption by Accused
12. Hon'ble Supreme Court in Rangappa Vs. S.Mohan decided on 07.5.2010 has further held : "However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transaction. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused Amit Soni Vs. Manoj Kumar page no. 11 /defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is tht of 'preponderance of probabilities. Therefore, if the accused I sable to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his /her own."
The presumption raised under section 139 is rebuttable. The defendant can prove non existence of consideration by raising a probable defence. The burden upon the defendant of proving non existence of consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. 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 139 in his favour. In such a scenario the test of proportionality should guide the construction and interpretation of reverse onus clauses and the accused defendant cannot be expected to discharge an unduly high standard of proof. In the absence of compelling justification, reverse onus clauses usually impose an evidentiary burden not a persuasive burden.
In the present case, the court holds that the accused has failed to rebut the mandatory presumption of law and has also failed to controvert the story of the complainant or to establish his own story. The opinion of the court is based upon following observations:
The complainant has also filed the promissory note dated 10.08.2014, on record. The same is exhibited as Ex. CW1/7, reflecting the loan of Rs.
Amit Soni Vs. Manoj Kumar page no. 12 1,50,000/ taken by the accused. Suggestions were given to the complainant during his cross examination that the Ex . CW1/7 was issued by the accused in blank with signature only. The suggestions were categorically denied by the complainant. The accused failed to step into the witness box to depose anything in this regard to substantiate his version of defence. The accused has failed to examine himself as witness.
The accused has failed to bring on record any independent evidence to substantiate his version of the story or to punch holes through the story of the complainant.
The accused has failed to file any police complaint to demand his cheque back from the complainant or issue stop payment instructions to his bank. An adverse inference can safely be drawn against the accused who failed to show that he indeed did everything in his power and control, as a prudent person would do to ensure that the cheques tendered by him were not misused. A prudent person will not keep quiet ,if he is not liable to pay such amount. It is highly improbable that a reasonably prudent person would use his own deemat account to invest money of other persons which is highly risky and also can come under the radar of the income tax department as tax shall be payable by the person holding the deemat account. The accused has also failed to bring on record any evidence to show that he was working as a stock broker or having any permit for making investments on behalf of other people or working as a financial advisor or investment banker etc to invest in stocks. 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 Amit Soni Vs. Manoj Kumar page no. 13 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 statutory presumptions in NI Act are mandatory in nature and the same cannot be rebutted by mere explanations of the accused. It is to be shown by the accused that the explanations given are not only reasonable, but also a true one. In order to do so, the accused is required to produce such cogent evidence which inspires confidence of the Court to believe the case of the accused rather than believing the case of the complainant, who was admittedly in possession of the dishonored cheque, admittedly signed by the accused. (Attar Singh Wadhwa Vs. NCT of Delhi decided by Hon'ble High Court of Delhi on 23.12.2009).
It is a settled position that the accused has to rebut the presumption raised under Section 139 and the standard of proof of which is 'preponderance of probabilities'. It is for the accused to raise a probable defence which creates a doubt on the version of the complainant. The accused, in the present matter has been unsuccessful in creating a doubt on the version of the complainant. Thus, even though in demonstrating the probability of his defence, the standard of proof which the accused is required to meet is preponderance of probability and not beyond reasonable doubt. On the appreciation of entire gamut of evidence placed before the court and the totality of circumstances obtaining in the case, it is apparent that the accused has been unable to setup a probable defence, which can rebut the presumption u/s 139 N.I.Act, which has been raised in favour of the complainant nor has he been able to punch holes through the case of the complainant.
CONCLUSION
Amit Soni Vs. Manoj Kumar page no. 14
14. As such, I hold that accused failed to rebut the mandatory presumption of law drawn in favour of the complainant.
15. I accordingly return a finding of guilt against the accused Manoj Kumar.
16. The accused Manoj Kumar is hereby convicted for the offence as punishable under Section 138 N.I.Act, 1881.
17. Let the accused be heard on the point of sentence.
18. A Copy of this order be placed on the official website of the District Courts.
Judgment contains 15 pages.
Digitally signed by BHUJALIAnnounced in the open Court BHUJALI Date:
2023.12.21
On 21st, December, 2023. 16:08:13 +0530
(BHUJALI)
MM01, North District
Rohini Courts, Delhi
Then M.M.01(N.I.Act)/Central,
THC/Delhi/21.12.2023
Amit Soni Vs. Manoj Kumar page no. 15