Delhi District Court
Rajeev Sharma vs Pallavi Advertising on 30 March, 2024
IN THE COURT OF ADDITIONAL SESSIONS JUDGE-08, WEST
DISTRICT TIS HAZARI COURTS, DELHI
Presided over by: Hem Raj, DHJS
1. CNR No. DLWT01-005923-2023
Criminal Appeal No. 245/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
2. CNR No. DLWT01-005921-2023
Criminal Appeal No. 246/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023
Rajeeev Sharma Vs M/s Pallavi Advertising Page 1 of 28
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
3. CNR No. DLWT01-005925-2023
Criminal Appeal No. 247/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
4. CNR No. DLWT01-005920-2023
Criminal Appeal No. 249/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023
Rajeeev Sharma Vs M/s Pallavi Advertising Page 2 of 28
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
5. CNR No. DLWT01-005922-2023
Criminal Appeal No. 250/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
6. CNR No. DLWT01-005924-2023
Criminal Appeal No. 251/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023
Rajeeev Sharma Vs M/s Pallavi Advertising Page 3 of 28
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
AND
7. CNR No. DLWT01-005919-2023
Criminal Appeal No. 252/2023
In the matter of :
Rajeev Sharma
S/o late Sh. M.R Sharma
R/o S-1/008, Pocket D-6,
Vasant Kunj, New Delhi-110070 ....(Appellant)
Versus
M/s Pallavi Advertising
Through its proprietor
C/o A-2B/18B, Ekta Apartment
Paschim Vihar, New Delhi-110063 ....(Respondent)
Date of Institution of appeal : 22-07-2023
Date of reserving for order : 02-03-2024
Date of pronouncement of order : 30-03-2024
ORDER
1. Vide this common order, I shall decide the afore-men- tioned seven appeals preferred by the appellant against the seven judgments passed by the Ld. Trial Court dated 05.06.2023 in seven complaints U/s 138 N.I Act filed by the respondent, which Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 4 of 28 all were titled as Pallavi Advertising Vs Rajeev Sharma. The ap- pellant was convicted for the offence u/s 138 N.I Act in each complaint. It may be mentioned that the common evidence of the respondent and the appellant were recorded in all seven cases. Vide seven separate orders on the point of sentence, the follow- ing directions were passed:-
i. Ct. Case no. 8284/2019Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
b). The appellant was also held liable to pay fine of Rs.5 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.ii. Ct. Case no. 8261/2019
Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
b). The appellant was also held liable to pay fine of Rs.10 Lakhs to the complainant (respondent herein) within 60 days;
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 5 of 28
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.
iii. Ct. Case no. 8287/2019Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
b). The appellant was also held liable to pay fine of Rs.10 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.iv. Ct. Case no. 8260/2019
Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 6 of 28
b). The appellant was also held liable to pay fine of Rs.10 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.
v. Ct. Case no. 8262/2019Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
b). The appellant was also held liable to pay fine of Rs.20 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.vi. Ct. Case no. 8286/2019
Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 7 of 28
b). The appellant was also held liable to pay fine of Rs.20 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.
vii. Ct. Case no. 8259/2019Pallavi Advertising Vs Rajeev Sharma:-
a). The appellant was sentenced to simple imprisonment for a period of one year;
b). The appellant was also held liable to pay fine of Rs.20 Lakhs to the complainant (respondent herein) within 60 days;
c). In default of payment of aforesaid compensation amount, the appellant was held liable to further undergo simple imprisonment for six months;
d). The Ld. MM further held that if the compensation amount is not paid in time, the same shall be recoverable under the provisions of Section 421 Cr.P.C R/w 431 Cr.P.C.
2. A careful perusal of the facts discussed by the Ld. Trial Court in each of the judgments would show that the facts in each complaint are similar and they arise out of the same transaction.
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 8 of 28 However, the cheques numbers, amount and the dates are different and for the sake of convenience, their particulars would be demonstrated in a table at the end of this paragraph. The necessary facts as mentioned in the judgments are that the appellant approached the respondent seeking loan for development of a Real Estate Project in Rohini promising the respondent to pay back the loan amount with an interest @ 12% per annum. The respondent advanced the loan amounts through RTGS and cash from its various accounts between the months of March, 2018 to September,2018 and the total sum advanced to the appellant was Rs. 69,00,000/-. To secure the said payments, the respondent had entered into two agreements to sell in respect of properties bearing Plot No. 457 land measuring 32 Sq. Mtr. Situated at Rohini Residential Scheme, Sector-37, Pkt, C-1 Delhi and built up property bearing no. 398 area 26 Sq. Mtr situated at Pocket B-1, Sector, Rohini, New Delhi allegedly owned by appellant. Later on, it was discovered that the said properties were never owned by the appellant and as such the appellant had not authority to the same. On discovering the said fact, the respondent called upon the appellant to pay back the loan amount immediately. In lieu of the same, the appellant paid a sum of Rs. 16,00,000/- between 01.10.2018 to 05.12.2018 and thereafter defaulted in making the balance payment of loan amount.
3. Since the appellant were not making the balance payment, the respondent involved various people who were mutually Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 9 of 28 known to both the parties. By the involvement of the said persons the appellant entered into a fresh agreement dated 18.03.2019 where the appellant expressly and unequivocally admitted an outstanding liability of Rs. 65,00,000/- after adjusting the amount of Rs. 16 lakhs toward the interest and outstanding payment as on that date. Pursuant upon the said agreement, the appellant gave postdated cheques for a total sum of Rs. 60,00,000/- to the respondent as partial discharge of the admittedly liability. The appellant offered to transfer a property being plot no. 628, area 26 Sq. Ft. Block A, Pocket 3, Sector-36, Rohini Residential Scheme, Delhi for a consideration of Rs. 20,50,000/- for which a registered sale deed was entered into on 29.04.2019. It was also agreed between the respondent and the appellant that the amount of consideration of Rs. 20,50,000/- would be set off against the outstanding admitted liability of Rs. 65,00,000/- only after receipt of original document of the said property which were according to the appellant lying mortgaged with some third party.
4. Despite various reminders and requests from the respondent, the appellant has failed to submit the original documents of the property bearing plot no. 628, area 26 Sq. Ft. Block A, Pocket 3, Sector-36, Rohini Residential Scheme, Delhi to the respondent. Without the said documents the said property had no marketable value and cannot be sold off by the respondent. The respondent also filed a criminal complaint dated 12.06.2019 for the fraud played by the appellant upon the respondent by illegally retaining the original papers of the Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 10 of 28 property and also entering into false agreements with the respondent to cause wrongful losses to the respondent. While the said complaint is pending investigation towards discharge of the pending and undisputed liability of the appellant, the appellant in order to avoid criminal prosecution, requested the respondent to present the post-dated cheques in question in partial discharge of its admitted inability. At the time of presentation of the cheques, the appellant assured the respondent that the same is good for value and will be honoured as and when presented. This fact was brought to the notice of the appellant through a telephonic call wherein the respondent duly informed the appellant to take immediate corrective measures and make the payments, to which the appellant, very discourteously and indifferently stated that he would neither make any payment nor taken any corrective measures regarding the cheque.
5. The respondent on receiving the said bank memo issued a statutory legal notice dated 06.09.2019 through speed post to the appellant as per the mandate of the provisions of Section 138 NI Act 1881 calling upon the appellant to pay the amount against the said dishonored cheque with 15 days from the date of receipt of the notice. The said notice was though received by the appellant on 09.09.2019, but he failed to respond the same. The appellant as the matter of fact had issued the aforesaid cheque merely as a device not only to stall but also to defraud the respondent and the said dishonor of cheque caused incalculable losses, injury and Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 11 of 28 inconvenience to the respondent and his entire credibility suffered because of the serious set-back on dishonour of the said cheque. The appellant avoided and neglected to refund the hard- earned money of the respondent which he gave as a loan to the appellant who deliberately issued the cheque which got dishonoured and since the appellant has not paid the amount of the dishonoured cheque within stipulated period he has committed the offence u/s 138 N.I Act. The conduct of the appellant prima facie demonstrated that he never had any intention to repay the amount or to honour the liability in lieu of the payments made to him by the respondent and he is even now reluctant to make any payment in this regard and has been evading his liability ever since.
6. The details of cheques in question in all the seven complaint cases are as follows:-
Cheque nos. Date Amount Drawn at 000069 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct. Case no. Bank, Vasant Kunj 8284/19) Branch, Delhi 000070 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct. Case no. Bank, Vasant Kunj 8261/2019) Branch, Delhi 000068 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct.Case no. Bank, Vasant Kunj 8287/2019) Branch, Delhi 000067 07.08.2019 Rs. 5,00,000/- Kotak Mahindra
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 12 of 28 (Ct.Case no. Bank, Vasant Kunj 8260/2019) Branch, Delhi 000073 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct.Case no. Bank, Vasant Kunj 8262/2019) Branch, Delhi 000218 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct.Case no. Bank, Vasant Kunj 8286/2019) Branch, Delhi 000217 07.08.2019 Rs. 5,00,000/- Kotak Mahindra (Ct.Case no. Bank, Vasant Kunj 8259/2019) Branch, Delhi
7. In notice u/s 251 Cr.P.C, the appellant pleaded not guilty and took the plea that he had taken Rs. 20 to 22 lakhs approxi- mately from Sh. Harish Gandhi through bank transfer and had duly returned the said amount to the respondent through bank transfer. The cheque in question was given as a security. He had filled four cheques of Rs. 5 lakhs each and given the same to the respondent under pressure and the said cheques had been mis- used by the respondent. He alleged that in-fact respondent had to give him back Rs. 7 lakhs and he had sent a legal notice to the re- spondent in this regard.
8. The grounds of appeal raised by the appellant in brief are summarized as under:-
a). The Ld. MM failed to consider the substantial fact that the entire loan amount had already been returned / transferred by the appellant to the respondent.
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 13 of 28
b). The Ld. MM also failed to consider that the appellant had sent a legal notice dated 10.08.2023 to the respondent to re- turn the security cheque along with excess payment received by the respondent.
c). In the impugned order, undue reliance over two agreements to sell for plot no. 457 and property no. 398 in Rohini for which these were to act as a measure of security for this loan.
d). Ld. MM failed to consider that the connected case between the parties filed by complainant i.e. Ct. Case no. 595/2020 ti- tled as Harish Gandhi Vs Rajeev Sharma stood dismissed on 14.03.2022.
e). The Ld. MM failed to observe that the respondent did not examine material witnesses namely Sh. Shiv Kumar Mahesh- wari and Sh. Deepak Kumar Thapar whose names were men- tioned in the list of witnesses provided by the respondent on 23.10.2019.
f). The document Ex.CW-1/1 i.e. calculation sheet of amounts paid by the appellant to the respondent is falsely created by the respondent himself.
g). The appellant is a senior citizen of 64 years of age. He is suffering from various ailments and now is unemployed.
h). The appellant had rebutted the presumption u/s 118 & 139 N.I Act not only be examining his own witnesses but also through the cross-examination of the respondent who is the only witnesses.
The Judgment of the Ld. Trial Court:
9. The noteworthy observations of the Ld. Trial Court in the impugned judgment can be summarized as under:
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 14 of 28 a. On the contention of the appellant that the respon- dents had not furnished any documentary proof regarding the advancement of the loan, the Ld. Trial Court observed that in view of his statement u/s 313 Cr.P.C and filing of his bank statements show that the entire defence of the appel- lant was that he had already returned the money to the re- spondent. Thus, the Ld. Trial Court held that the aforesaid contention of the appellant was not maintainable.
b. The appellant raised a contention that the cheques in question were security cheques. However, Ld. Trial Court held that once the cheques had been duly signed by the appellant, therefore, the other particulars having been filed by the respondent, did not matter. In this re- gard, the Ld. Trial Court relied upon a judgment re- ported as (2019) 4 SCC 197. Hence, the Ld. Trial Court rejected the said contention of the appellant.
c. Regarding the contention of the appellant that he had already returned the money to the respondent, it was held by the Ld. Trial Court that in view of the settlement Ex.CW-1/4 which had been duly admitted by the appel- lant and further that the appellant failed to cross-exam- ine the respondent on Ex.CW-1/4 and further that the appellant admitted that he was not the owner of two properties for which the sale documents were executed and further that the document Ex.DW-1/2 relied upon by the appellant to show the payment of Rs. 20 Lakhs was not beleivable, the said contention was rejected.
d. Ld. Trial Court then held that the respondent had proved the necessary ingredients of the offence u/s 138 N.I Act and on the other hand, the appellant had failed to rebutt the presumption u/s 118 r/w 139 N.I Act and, therefore, the respondent had been able to prove its case.
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 15 of 28
10. I have heard the arguments advanced by the Ld. Counsel for the appellant and the respondent as well as perused the record carefully.
11. Section 138 of the Act reads as follows:-
"138. Dishonour of cheque for insufficiency, etc. of funds in the account.--Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for [a term which may be extended to two years'], or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless--
(a) the cheque has been presented to the bank within a period of six months;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation.--For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability."
12. In the judgment of Dashrathbhai Trikambhai Patel v. Hitesh Mahendrabhai Patel, (2023) 1 SCC 578, the Hon'ble Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 16 of 28 Supreme Court laid down the following ingredients of offence U/s 138 NI Act. The relevant observations are reproduced hereasunder:-
"11. Section 138 of the Act provides that a drawer of a cheque is deemed to have committed the offence if the following ingredients are fulfilled:
(i) A cheque drawn for the payment of any amount of money to another person;
(ii) The cheque is drawn for the discharge of the "whole or part" of any debt or other liability. "Debt or other liability"
means legally enforceable debt or other liability; and
(iii) The cheque is returned by the bank unpaid because of insufficient funds.
However, unless the stipulations in the proviso are fulfilled the offence is not deemed to be committed. The conditions in the proviso are as follows:
(i) The cheque must be presented in the bank within six months from the date on which it was drawn or within the period of its validity;
(ii) The holder of the cheque must make a demand for the payment of the "said amount of money" by giving a notice in writing to the drawer of the cheque within thirty days from the receipt of the notice from the bank that the cheque was returned dishonoured; and
(iii) The holder of the cheque fails to make the payment of the "said amount of money" within fifteen days from the receipt of the notice."
13. It is well settled principle of law that in a case u/s 138 NI Act when a cheque has been issued by a person and he is arrayed as an accused, he has limited defences available to him. Also once a negotiable instrument is executed certain presumptions are raised although they are rebuttable presumptions. One of the defence is that the alleged consideration and debt did not exist or that in the particular circumstances of the case the non-existent of Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 17 of 28 consideration or debt is so probable that a prudent man must sup- pose that the said consideration or debt did not exist. In this re- gard, the observations of the Hon'ble Supreme Court in the case of "Kumar Exports Vs. Sharma Carpets, (2009) 2 SCC 513" are relevant. The same are reproduced hereunder:
"12. In order to determine the question whether offence punishable under Section 138 of the Act is made out against the appellant, it will be necessary to examine the scope and ambit of presumptions to be raised as envisaged by the provisions of Sections 118 and 139 of the Act. In a suit to enforce a simple contract, the plaintiff has to aver in his pleading that it was made for good consideration and must substantiate it by evidence. But to this rule, the nego- tiable instruments are an exception.
13. In a significant departure from the general rule applica- ble to contracts, Section 118 of the Act provides certain presumptions to be raised. This section lays down some special rules of evidence relating to presumptions. The rea- son for these presumptions is that, negotiable instrument passes from hand to hand on endorsement and it would make trading very difficult and negotiability of the instru- ment impossible, unless certain presumptions are made. The presumption, therefore, is a matter of principle to facil- itate negotiability as well as trade. Section 118 of the Act provides presumptions to be raised until the contrary is proved (i) as to consideration, (ii) as to date of instrument,
(iii) as to time of acceptance, (iv) as to time of transfer, (v) as to order of indorsements, (vi) as to appropriate stamp, and (vii) as to holder being a holder in due course.
14. Section 139 of the Act provides that it shall be pre-
sumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in Sec- tion 138 for the discharge, in whole or in part, of any debt or other liability.
15. Presumptions are devices by use of which the courts are enabled and entitled to pronounce on an issue notwithstand- ing that there is no evidence or insufficient evidence. Under the Evidence Act all presumptions must come under one or the other class of the three classes mentioned in the Act, namely, (1) "may presume" (rebuttable), (2) "shall presume"
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 18 of 28 (rebuttable), and (3) "conclusive presumptions" (irrebut- table). The term "presumption" is used to designate an infer-
ence, affirmative or disaffirmative of the existence of a fact, conveniently called the "presumed fact" drawn by a judicial tribunal, by a process of probable reasoning from some mat- ter of fact, either judicially noticed or admitted or estab- lished by legal evidence to the satisfaction of the tribunal. Presumption literally means "taking as true without exami- nation or proof".
16. Section 4 of the Evidence Act inter alia defines the words "may presume" and "shall presume" as follows:
"4. 'May presume'.--Whenever it is provided by this Act that the court may presume a fact, it may either regard such fact as proved, unless and until it is disproved, or may call for proof of it:
'Shall presume'.--Whenever it is directed by this Act that the court shall presume a fact, it shall regard such fact as proved, unless and until it is disproved:
In the former case, the court has an option to raise the pre- sumption or not, but in the latter case, the court must neces- sarily raise the presumption. If in a case the court has an op- tion to raise the presumption and raises the presumption, the distinction between the two categories of presumptions ceases and the fact is presumed, unless and until it is dis- proved.
17. Section 118 of the Act, inter alia, directs that it shall be presumed, until the contrary is proved, that every ne- gotiable instrument was made or drawn for considera- tion. Section 139 of the Act stipulates that unless the con- trary is proved, it shall be presumed, that the holder of the cheque received the cheque, for the discharge of whole or part of any debt or liability.
18. Applying the definition of the word "proved" in Section 3 of the Evidence Act to the provisions of Sections 118 and 139 of the Act, it becomes evident that in a trial under Sec- tion 138 of the Act a presumption will have to be made that every negotiable instrument was made or drawn for consid- eration and that it was executed for discharge of debt or lia- bility once the execution of negotiable instrument is either proved or admitted. As soon as the complainant dis- charges the burden to prove that the instrument, say a note, was executed by the accused, the rules of presump- tions under Sections 118 and 139 of the Act help him Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 19 of 28 shift the burden on the accused. The presumptions will live, exist and survive and shall end only when the contrary is proved by the accused, that is, the cheque was not issued for consideration and in discharge of any debt or liability. A presumption is not in itself evidence, but only makes a prima facie case for a party for whose benefit it exists.
19. The use of the phrase "until the contrary is proved" in Section 118 of the Act and use of the words "unless the con- trary is proved" in Section 139 of the Act read with defini- tions of "may presume" and "shall presume" as given in Sec- tion 4 of the Evidence Act, makes it at once clear that pre- sumptions to be raised under both the provisions are rebut- table. When a presumption is rebuttable, it only points out that the party on whom lies the duty of going forward with evidence, on the fact presumed and when that party has pro- duced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presump- tion is over.
20. The accused in a trial under Section 138 of the Act has two options. He can either show that consideration and debt did not exist or that under the particular cir- cumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to sup- pose that no consideration and debt existed. To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is ex- pected of the complainant in a criminal trial. The ac- cused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the court need not insist in every case that the accused should disprove the non-existence of considera- tion and debt by leading direct evidence because the ex- istence of negative evidence is neither possible nor con- templated. At the same time, it is clear that bare denial of the passing of the consideration and existence of debt, apparently would not serve the purpose of the accused. Something which is probable has to be brought on record for getting the burden of proof shifted to the com- plainant. To disprove the presumptions, the accused should bring on record such facts and circumstances, upon consid- eration of which, the court may either believe that the con- sideration and debt did not exist or their non-existence was so probable that a prudent man would under the circum- stances of the case, act upon the plea that they did not exist.
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 20 of 28 Apart from adducing direct evidence to prove that the note in question was not supported by consideration or that he had not incurred any debt or liability, the accused may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again on to the complainant. The accused may also rely upon presumptions of fact, for instance, those mentioned in Section 114 of the Evidence Act to rebut the presumptions arising under Sections 118 and 139 of the Act.
21. The accused has also an option to prove the non-exis- tence of consideration and debt or liability either by letting in evidence or in some clear and exceptional cases, from the case set out by the complainant, that is, the averments in the complaint, the case set out in the statutory notice and evi- dence adduced by the complainant during the trial. Once such rebuttal evidence is adduced and accepted by the court, having regard to all the circumstances of the case and the preponderance of probabilities, the evidential burden shifts back to the complainant and, thereafter, the presump- tions under Sections 118 and 139 of the Act will not again come to the complainant's rescue."
(Emphasis supplied)
14. From the aforesaid observations in the case of Kumar Ex- ports (supra), the law regarding the presumption once the execu- tion of the negotiable instrument is done, how the presumption can be rebutted and the nature of burden of proof etc. is clear. In view of the aforesaid position of law, now let me decide if the ap- pellant has made a case to rebut the presumption as an accused before the Ld. Trial Court.
15. Let me first take into the consideration the submissions of the appellant that he had already returned the cheque amount and not only that but the respondent had a liability of Rs. 7 lakhs to- wards him, which he did not pay. The appellant has relied upon the bank statement of Kotak Mahindra Bank, PNB and Federal Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 21 of 28 Bank Ex.DW-1/1 (colly). In this regard, the document Ex.CW- 1/4 assumes importance. This document is a receipt dated 18.03.2019 executed by the appellant in favour of the respondent. This document is not only signed by the appellant and respondent but, also signed by two witnesses including Shiv Kumar Mahesh- wari. In this receipt, the appellant had admitted his liability of Rs. 65 lakhs. The said receipt also states that the parties had agreed that all the previous agreement between the appellant and the re- spondent stands fully and finally settled.
16. The Ld. Trial Court observed that in the cross-examination of the respondent, the appellant had not cross-examined the re- spondent on the document Ex. CW-1/4. I have gone through the testimony of the respondent and finds that indeed no cross-exam- ination had been conducted by the appellant. It implies that the appellant had not challenged the testimony of the respondent re- garding the document Ex.CW-1/4. The only irresistible conclu- sion which one can draw is that the appellant had admitted the said document. It is well settled principle of law that if a party does not challenge the positive statement of a witness or some document, the parties then is deemed to have admitted the said evidence. Thus, it has been proved on the record by the appellant on 18.03.2019, the appellant had a liability of Rs. 65 lakhs to- wards the respondent.
17. The appellant has put forth the contention that he has re- turned the money to the respondent and in fact he had an out-
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 22 of 28 standing credit of Rs. 7 lakhs from the respondent. He has relied upon the documents Ex.DW-1/1 (colly) i.e. the bank statement. The Ld. Trial Court observed in this regard that the payments made by the appellant before 18.03.2019 cannot be looked into by the court towards the re-payment of the loan. The Ld. MM also observed that since the document Ex.CW-1/4 could not be rebutted, therefore, the payment before 18.03.2019.
18. In order to substantiate his defence that the appellant had already returned the amount due to the respondent, the appellant had relied upon the document Ex.DW-1/1 (colly) i.e. bank state- ments. The Ld. Trial Court observed that there is no entry in the bank statements showing any payment after 18.03.2019 on which date the full and final settlement vide receipt Ex.CW-1/4 was ar- rived at between the parties. I have also seen the same and found that there is no entry showing any payment after 18.03.2019 to the respondent. Therefore, there is nothing on record that any payment was made by the appellant to the respondent after 18.03.2019.
19. The appellant has also stressed upon the fact that at the in- stance of the respondent, some payment was made to Mr. Thapar i.e. the brother-in-law of the respondent. The document Ex.DW- 1/1 (colly) although contains two entries showing payment by the respondent to Mr. Thapar. The Ld. Trial Court observed that there is no evidence to show that such payment had been made by the appellant to Mr. Thapar at the instance of the respondent adjust-
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 23 of 28 ing the loan amount. The complaint filed by Mr. Thapar had been dismissed for non-prosecution. In this regard, I do not find and infirmity in the reasoning of the Ld. Trial Court that without there being any substantial evidence, the payment by the appel- lant to Mr. Thapar, cannot be said at the instance of the respon- dent. Hence, this submission of the appellant is liable to be re- jected.
20. In his statement u/s 313 Cr.P.C, the appellant had admitted the receipt Ex.CW-1/4 but he submitted that it was signed under force and pressure. The appellant's case in this regard was that he was forced to sign the aforesaid receipt in the office of ACP and therefore, he is not bound by the said receipt. The appellant, in his cross-examination stated that he did not file any complaint or did not make any PCR call that he had been forced, coerced or put under any pressure while signing the said receipt. Therefore, the Ld. Trial Court had rightly rejected the said defence of the ap- pellant. This court is also of the opinion that the appellant had failed to prove his theory that he had been forced by the respon- dent and the ACP of the police to sign the document Ex.CW-1/4. Accordingly, the submission of the appellant stands rejected.
21. The appellant has also relied upon the document Ex.DW- 1/2 to show that he had made a payment of Rs. 20 lakhs to the respondent. This document has been rejected by the Ld. Trial Court and rightly so. The Ld. Trial Court observed that in his ap- plication u/s 145 (2) N.I Act, the said document was not annexed Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 24 of 28 by the appellant. It was observed that if the said document was available with the appellant, there was no reason as to why the said document was not filed along with this application u/s 145 (2) N.I Act. Moreover, the said document also did not have any witnesses to the said transaction.
22. I am also of the opinion that this receipt is not a genuine document for the reasons that firstly, this document does not find mention either in his application u/s 145 (2) N.I Act, in his state- ment u/s 313 Cr.P.C as well as the legal notice dated 10.08.2019. Secondly in the cross-examination also, the appellant had agreed that the said document was not mentioned earlier. It is beyond any comprehension as to why the said document being available with the appellant depicting the payment of Rs. 20 lakhs, did not find the light of the day earlier. This court finds that the docu- ment Ex.DW-1/2 is not a reliable document and cannot be taken into consideration. Hence, the said document does not pass the test of reasonableness and appears to be prepared by the appel- lant later on. Accordingly, I do not find any infirmity in the rea- soning of the Ld. Trial Court in that regard.
23. The next point urged by the appellant is that the respondent had an outstanding liability of Rs. 7 lakhs towards him, which had not been cleared by the respondent. The Ld. Trial Court re- jected the said argument observing that there was nothing on the record to substantiate the same and also that the appellant had never filed any complaint or civil suit for the recovery of afore-
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 25 of 28 said amount of Rs. 7 lakhs. I have perused the record. I have also not found any evidence for the same. It is also beyond any com- prehension as to why the appellant had not filed any civil suit for the recovery of the said amount of Rs. 7 lakhs. Therefore, there is nothing wrong in the said reasoning of the Ld. Trial Court while rejecting the said argument.
24. The next comes the argument of the appellant that Ld. Trial Court has emphasized and placed undue reliance on the two agreements to sell holding that since the appellant had not owner- ship in the properties under the agreement to sell. However, I am not impressed with the said submission of the appellant as after the execution of the receipt Ex.CW-1/4, which had been duly ad- mitted by the respondent and also that there is no cross-examina- tion, the aforesaid agreements to sell have no bearing in the lia- bility of the appellant towards the respondent.
25. The appellant further urged that the respondent had not ex- amined Mr. Thapar and Mr. Shiv Kumar Maheshwari despite cit- ing them as witnesses and the Ld. Trial Court failed to appreciate the same. In view of certain admissions and absence of cross-ex- amination of the respondent challenging his testimony regarding document Ex.CW-1/4, I opine that examination of those two wit- nesses was not necessary. Even otherwise, if the respondent did not examine them, it was always open for the appellant to exam- ine them as a witness and prove his case. However, for the rea- sons best known to the appellant, he did not examine them.
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 26 of 28 Therefore, no fault can be found with the respondent for not ex- amining the aforesaid two witnesses.
26. The appellant has also canvassed that the Ld. Trial Court had ignored the ATR filed by the IO in connected Criminal Com- plaint 595/2020 titled Harish Gandhi Vs Rajeev Sharma. How- ever, the record reveals that the said ATR report had not been proved on record by the appellant. He did not examine the IO to depose about the ATR nor the appellant had asked any question about the same in his cross-examination of respondent. The ap- pellant also did not depose anything about the same in his exami- nation-in-chief. Therefore, the Ld. Trial Court was not required to consider any ATR report, if any as the same did not form the part of the record.
27. Therefore, the aforesaid discussions lead to the conclusion that the appellant had failed to prove that he had already returned the money to the respondent. Thus, the appellant had failed to re- but the presumption under Sections118 & 139 N.I Act
28. Since, I have held that the appellant had failed to rebut the presumption u/s 18 r/w 139 N.I Act in favour of the respondent, still it is to be seen whether the respondent had been able to prove the other essential ingredients of the offence u/s 138 N.I Act.
29. The cheques in question were never in dispute as the ap- pellant never denied the cheques. The appellant also admitted the signatures on the cheques. The bank slip is the proof of the dis-
Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 27 of 28 honour of cheques as per section 146 N.I Act. The respondent also proved legal notice Ex.CW-1/8 and the same had also been admitted by the appellant in reply to the notice u/s 251 Cr.P.C as well as in his statement u/s 313 Cr.P.C. In fact, the appellant sub- mitted that the legal notice had been replied by him. It is also an admitted fact on record that despite the receipt of the legal notice of the respondent, the appellant did not pay the money as de- manded within fifteen days from the legal notice. Accordingly, it is crystal clear that the respondent had proved the other essential ingredients of the offence u/s 138 N.I Act against the respondent.
30. In view of the afore-said discussions and the settled propo- sitions of law, this court is of the opinion that there is not merit in the appeals and the impugned judgment of the Ld. Trial Court is a well-reasoned judgment requiring no interference. Accordingly, all the aforesaid seven appeals stand dismissed.
31. A signed copy of this order be placed in each appeal file.
32. Trial court record along with an attested copy of this order be sent back to the Ld. Trial Court.
33. Appeal file be consigned to record room.
Digitally signed by HEM HEM RAJ Date:
RAJ 2024.03.30 Pronounced in the open 16:25:19 +0530 Court on 30.03.2024. (Hem Raj) Additional Sessions Judge -08 (West) Tis Hazari Courts Delhi Crl. Appeal Nos. 245/ 246/247/249/250/251/252 of 2023 Rajeeev Sharma Vs M/s Pallavi Advertising Page 28 of 28