Delhi District Court
Ganga Devi vs Rajinder Kumar Beserwal on 29 August, 2024
CNR No.: DLST02-039316-2022
IN THE COURT OF MS. NORMA JAIN,
JMFC (NI ACT) DIGITAL COURT-01, SOUTH DISTRICT,
SAKET COURT COMPLEX, NEW DELHI.
In the matter of: CC No.: 7556/2022
CNR NO.: DLST02-039316-2022
Ganga Devi
W/o Pawan Sharma,
R/o B-59, Durga Vihar, Khanpur,
New Delhi-110080. ......Complainant
versus
Rajinder Kumar Beserwal
S/o Sh. Tulshi Ram Beserwal
R/o B-63, Durga Vihar, Khanpur,
New Delhi.
Mob No. 9910080510 ........Accused
JUDGEMENT
Date of Institution of Complaint : 29.11.2022 Police Station : Khanpur Offence Complained of : u/s. 138 of NI Act Plea of Accused : Not Guilty Date of Final Arguments Heard : 06.08.2024 Decision Qua Accused : Acquitted.
Date of Decision : 29.08.2024.
BRIEF STATEMENT OF REASONS FOR DECISION
1. Vide this judgment, I shall decide the present complaint filed under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the 'NI Act') by the complainant against the CC No. 7556/2022 Digitally Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 1 of 20 signed by NORMA NORMA JAIN Date:
JAIN 2024.08.29 13:28:20 +0530 CNR No.: DLST02-039316-2022 accused on account of dishonour of 4 cheques i.e. 3 cheques, bearing no. 617922, 617923 & 617921 all dated 17.09.2022 of Rs.50,000/- each drawn on Corporation Bank, Deoli Branch, New Delhi and 4 th Cheque, bearing no. 650390 dated 17.09.2022 of Rs.1,00,000/- drawn on SBI, DLF Phase-3, Gurgaon allegedly issued by the accused in favour of the complainant (hereinafter referred to as the 'cheques in question').
CASE OF THE COMPLAINANT
2. Brief facts of the case as per the complaint are that the accused and the complainant were known to each other and in the year 2017, the accused approached the complainant and asked for a friendly loan of Rs.2,50,000/-. Considering the request of the accused, the sum of Rs.2,50,000/- (hereinafter referred to as "loan amount") was given by the complainant to the accused and at the time of taking loan the accused gave the cheques in question to the complainant assuring that the same will be honored on its presentation.
3. Thereafter, the complainant made various requests to the accused to make the payment, however, the accused asked the complainant to present the cheques in question. Accordingly, the complainant presented the cheques in question, however, on presentation the first three cheques in question were returned dishonoured with remarks "Cheque Invalid/Corporation Bank merged with Union Bank of India" vide cheque return memos dated 27.09.2022 and 4th cheque returned dishonoured with remarks "Funds Insufficient" vide cheque return memo dated 28.09.2022 (hereinafter collectively referred to as the said "return memos"). Consequently, legal notice dated 13.10.2022 was sent to the accused and since no CC No. 7556/2022 Digitally signed by Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 2 of 20NORMA NORMA JAIN Date:
JAIN 2024.08.29 13:28:25 +0530 CNR No.: DLST02-039316-2022 payment was made within 15 days of the service of legal notice, the present complaint came to be filed.
4. In support of the case of the complainant, Ld. Counsel for the complainant relied on averments made in the complaint, evidence by way of affidavit of the complainant, the presumption of law under Section 118(a) read with Section 139 of NI Act and the following documentary evidence:
S. No. Documents Exhibit No.
1. Cheque No. 650390 Ex. CW-1/1
2. Return memo dated 28.09.2022 Ex. CW-1/2
3. Cheques No. 617923, 617921 & 617922 Ex. CW-1/3 to
Ex. CW-1/5
4. Return memo dated 28.09.2022 Ex. CW-1/6
5. Legal demand notice Ex. CW-1/7
6. Original speed post receipt Ex. CW-1/8
7. Copy of tracking report Ex. CW-1/9
CASE PROCEEDINGS
5. In the present matter, notice of accusation under Section 138 of the NI Act read with Section 251 of the Code of Criminal Procedure, 1973 (hereinafter referred to as 'CrPC') was served on the accused on 21.04.2023 and the accused pleaded not guilty and claimed trial. The plea of defence of the accused was also recorded by the court on the same day. In the plea of defence, the accused stated that he did not receive the legal demand notice and that the cheques in question were issued to the complainant in a blank signed condition by way of security. He further stated that his wife had taken a friendly loan of Rs. 1.5 Lakhs from the complainant for personal use in 2015-2017 and the CC No. 7556/2022 Digitally signed by Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 3 of 20 NORMA NORMA Date:
JAIN JAIN 2024.08.29 13:28:30 +0530 CNR No.: DLST02-039316-2022 cheques drawn from the Corporation bank were issued from the joint account of his and his wife at the time of availing loan, however, on merger of Corporation bank with Union bank of India, he had issued the fresh cheque of State Bank of India in favor of the complainant. He admitted that the amount in all the cheques were filled by him, however, the name of payee and the date in all the cheques in question were not filled by him. He further submitted that in the year 2021, amount of Rs. 50,000/- in cash was given by his wife to the complainant and in October-November 2021, he had given the cheque drawn on SBI bank to the complainant. He admitted his liability to be only of Rs. 1,00,000/- and stated that he is willing to pay the same in installment.
6. An application under Section 145 (2) NI Act of the accused was allowed vide order dated 21.04.2023 and the accused was granted an opportunity to cross-examine the complainant. The complainant entered in the witness box as CW1, she was duly cross-examined and was thereafter discharged. Since complainant did not wish to examine further witnesses, accordingly, the post-summoning evidence was closed vide order 29.05.2024.
7. Statement of accused under Section 313 CrPC read with Section 281 CrPC was recorded on 29.05.2024 and all the incriminating evidence was put to the accused. During his statement, accused denied taking a sum of Rs.2,50,000/- from the complainant and stated that he took only a sum of Rs.1,50,000/- from her out of which he has already repaid a sum of Rs.50,000/- and stated that only Rs.1,00,000/- remains to be paid to the complainant. He further stated that he initially gave 3 cheques of Corporation Bank as security to the complainant as her Digitally CC No. 7556/2022 signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 4 of 20 JAIN Date:
2024.08.29 13:28:35 +0530 CNR No.: DLST02-039316-2022 husband stated that he does not want the cheques of his wife. He further stated that in 2021, the complainant stated that she needs her money back for construction of her house and at that time, he returned a sum of Rs.50,000/- to the complainant and asked her to return his 3 cheques, however, the same were not returned by her stating that the construction work of her house is going on. He further stated that for the remaining liability of Rs.1 Lakh, he handed over the cheque of Rs.1 Lakh from his SBI Account as security to the complainant. He further stated that the complainant did not approach him or his wife before presenting the cheques in question. He admitted the receipt of legal demand notice. He stated that on the cheques in question, amount as well as his signatures are in his hand writing, however, the date and payee name was not filled by him nor by his wife. He further submitted that the cheques of Corporation Bank i.e. Rs.50,000/- each were given in the year 2017-18 and the SBI cheque was given in the year 2021.
8. Since the accused chose to lead Defence Evidence in his statement under Section 313 CrPC, matter was fixed for filing of appropriate application under Section 315 CrPC along with list of witnesses. However, thereafter, as the counsel for the accused stated that accused does not wish to lead the defence evidence, defence evidence was closed vide order dated 22.07.2024 and matter was adjourned for final arguments.
9. I have heard counsel for the parties, perused the record and have gone through the relevant provisions of the law.
LAW UNDER CONSIDERATION
10. It would be apposite to first consider the legal position serving Digitally CC No. 7556/2022 signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 5 of 20 JAIN Date:
2024.08.29 13:28:40 +0530 CNR No.: DLST02-039316-2022 as base to the offence underlying Section 138 of NI Act. The following legal requirements need to be satisfied in order to constitute an offence under Section 138 of NI Act, as held by Hon'ble Supreme Court in the case titled as Kusum Ingots & Alloys Ltd. v. M/s Pennar Peterson Securities Ltd.: (2000) 2 SCC 745:
(i) that a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability;
(ii) that the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity whichever is earlier;
(iii) that the cheque is returned by the bank unpaid either because of the amount of money standing to the credit of the 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 the bank;
(iv) that the payee or the holder in due course of the cheque 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;
(v) that the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice;
The above legal requirements are cumulative, meaning thereby that only if all the aforementioned ingredients are satisfied, the person who had drawn the cheque be held liable for offence under Section 138 of NI Act.
11. Burden of proof: The claim based under the provisions of NI Act is an exception to the general rule of law that burden of proof lies on the prosecution. The two specific provisions viz. Section 118 (a) and Section 139 of NI Act contemplates that a presumption is attached in regard to each and every negotiable instrument that the same was drawn and issued against due discharge of the liability and thus, Digitally CC No. 7556/2022 signed by NORMA Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 6 of 20 NORMA JAIN JAIN Date:
2024.08.29 13:28:51 +0530 CNR No.: DLST02-039316-2022 whenever any claim is made on the basis of a negotiable instrument, the presumption has to be drawn in favour of the holder of the cheque (drawee) and the law has put the burden to rebut the presumption on the accused that the cheque was not issued by him against discharge of a debt or a liability. The rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'. In case, the accused is not able to rebut the presumption and fails to prove his defence, the presumption becomes absolute and it has to be assumed that the cheque was issued by the accused in discharge of debt or liability and consequently, accused is assumed guilty of the offence. Reliance in this regard is placed on the judgment of the Hon'ble Supreme Court in in the case of Rangappa versus Mohan 2010 (11) SCC 441 and Hiten P. Dalal v. Bratindranath Banerjee 2001 (6) SCC.
12. The principles regarding the onus of proof have also been laid down by the Hon'ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5 SCC 418 wherein it was held that the drawing of presumption is mandatory, if the execution of the cheque is admitted. Thus, once the accused admits execution of cheque, it is mandatorily presumed under the Act that the cheque was issued for discharge of any debt or other liability. In fact, the presumption would include presumption as to the existence of the debt. However, what is important for the presumptions to operate is the proof of foundational facts. In this regard, the initial onus of proving the debt is always on Digitally CC No. 7556/2022 signed by NORMA Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 7 of 20 NORMA JAIN JAIN Date:
2024.08.29 13:28:55 +0530 CNR No.: DLST02-039316-2022 the complainant. However, if the execution of the cheque is admitted, the onus shifts by virtue of the presumptions, and it shifts upon the accused to raise a probable defence.
13. The cheques in question admittedly have been signed by the accused. As the accused has admitted his signatures on the cheques in question, presumption under Section 118(a) read with Section 139 of NI Act is raised against the accused that the cheques in question were issued to the complainant in discharge of legally enforceable debt or liability and it is now on him to raise a probable defence and to prove his case on the basis of preponderance of probabilities. APPPRECIATION OF EVIDENCE/DEFENCE VIS-À-VIS FULFILLMENT OF REQUIREMENT UNDER SECTION 138 OF NI ACT:
14. Firstly, the Ld. Counsel for the accused argued that the wife of the accused took loan from the complainant and thereby, the liability was that of the wife of the accused and not the accused. He further argued that as the wife of the accused did not give the accused any authority to give the cheques in question, liability under Section 138 NI Act cannot be fastened on the accused just being the drawer.
15. Per contra, Ld. Counsel for the complainant argued it cannot be said that the accused cannot be held liable for the liability of his wife as the cheques in question were drawn by the accused.
16. To deal with the above contention, it is relevant to refer to Section 138 of the NI Act, which states that:
"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 CC No. 7556/2022 Digitally signed by Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 8 of 20 NORMA NORMA Date:
JAIN JAIN 2024.08.29 13:29:00 +0530 CNR No.: DLST02-039316-2022 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 4 [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
17. Perusal of Section 138 of the NI Act shows that it uses the word 'any debt or other liability', the liability is not necessarily that to be of the drawer but it can be of any other person. It also uses the word 'any cheque' which means that the cheque can be for any debt and liability. Reliance in this regard is placed on the judgment of the Hon'ble Supreme Court in I.C.D.S. Ltd. versus Beena Shabeer & Anr. Appeal (Crl.) 797 of 2002 dated 12/08/2002, in which the Hon'ble Supreme Court clarified the terms 'any debt or other liability' as well as 'any cheque' used in Section 138 of NI Act:
The language, however, has been rather specific as regards the intent of the legislature. The commencement of the Section stands with the words "Where any cheque". The above noted three words are of extreme significance, in particular, by reason of the user of the word "any" the first three words suggest that in fact for whatever reason if a cheque is drawn on an account maintained by him with a banker in favour of another person for the discharge of any debt or other liability, the highlighted words if read with the first three words at the commencement of Section 138, leave no manner of doubt that for whatever reason it may be, the liability under this provision cannot be avoided in the event the same stands returned by the banker unpaid. The legislature has been careful enough to record not only discharge in whole or in part of any debt but the same includes other liability as well. This aspect of the matter has not been appreciated by the High Court, neither been dealt with or even referred to in the impugned judgment. The issue as regards the co-extensive liability of the guarantor and the principal debtor, in our view, is totally out of the purview of Section 138 of the Act, neither the same calls for any discussion therein. The language of the Statute depicts the intent of the law-makers to the effect that wherever there is a default on the part of one in CC No. 7556/2022 Digitally signed by Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 9 of 20 NORMA NORMA JAIN JAIN Date:
2024.08.29 13:29:08 +0530 CNR No.: DLST02-039316-2022 favour of another and in the event a cheque is issued in discharge of any debt or other liability there cannot be any restriction or embargo in the matter of application of the provisions of Section 138 of the Act: 'Any cheque' and 'other liability' are the two key expressions which stands as clarifying the legislative intent so as to bring the factual context within the ambit of the provisions of the Statute. Any contra interpretation would defeat the intent of the legislature. The High Court, it seems, got carried away by the issue of guarantee and guarantor's liability and thus has overlooked the true intent and purport of Section 138 of the Act. The judgments recorded in the order of the High Court do not have any relevance in the contextual facts and the same thus does not lend any assistance to the contentions raised by the respondents."
18. Perusal of the above judgment shows that the cheque in question can be issued for any debt or any other liability and it is not required that the liability is that of the person only who is the drawer of the cheque, accordingly, the said argument/defence of the accused cannot be accepted.
19. Secondly, the Ld. Counsel for the accused argued that the wife of the accused only took a sum of ₹1,50,000/- from the complainant and liability of the accused/his wife was only for a sum of ₹1,00,000/- when the cheques in question were presented as ₹50,000/- were already returned by the accused to the complainant.
20. On the other hand, the Ld. Counsel for the complainant argued that the burden lied on the accused to prove that his liability was not to the extent of ₹2,50,000/- which he failed to prove. He further argued that the accused has not brought any document in support of his contentions.
21. It is the case of the complainant that the accused is her neighbour and the accused gained her faith and confidence because of which she advanced a sum of ₹2,50,000/- to the accused in 2017 by arranging it in cash in 'installments'. The word installment is missing CC No. 7556/2022 Digitally signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 10 of 20 JAIN Date:
2024.08.29 13:29:13 +0530 CNR No.: DLST02-039316-2022 in evidence by way of affidavit Ex. CW1/A filed by the complainant. It has further been stated that the accused gave her 4 cheques in question at the time of receiving the loan amount.
22. The accused denied taking a sum of ₹2,50,000/- from the complainant and stated that his wife only took a sum of ₹1,50,000/- from the complainant in 2015-2017. In his statement under Section 313 CrPC, he stated that he took a sum of ₹1,50,000/- from the complainant.
23. In the present case, the accused has not led any evidence, thereby, we will have to look at the cross-examination of CW1 to see whether accused has been able to rebut the presumption on the basis of cross-examination of complainant's witnesses or otherwise by pointing out the flaws in the complainant's case or through the evidence led by her during the course of the trial or from the circumstances on record or not.
24. The complainant in the complaint as well as evidence by way of affidavit Ex. CW1/A very vaguely without mentioning any details of the same stated that she gave a sum of ₹2,50,000/- to the accused in 2017 in cash because of being his neighbour and having friendly relations with him. On the other hand, when the complainant entered in the witness box, she stated that she is friends with the wife of the accused and had very less talking term with the accused. She also stated that she handed over ₹2,50,000/- to the wife of the accused on 4 different occasions for different requirements. She further stated that the loan was requested by the wife of the accused.
25. Further, in the complaint as well as affidavit, it has been written that the cheques in question were given when ₹2,50,000/- were given Digitally CC No. 7556/2022 signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 11 of 20 JAIN Date:
2024.08.29 13:29:27 +0530 CNR No.: DLST02-039316-2022 to the accused by the complainant, however, in the cross-examination of the complainant, it came out that ₹2,50,000/- were not given at one go and the same were given in various installments to the wife of the accused, when exactly the cheques were given to the complainant, on handing over of which amount, has not been explained. The complainant merely stated that 4 cheques in question were given by the wife of the accused in 2017.
26. The entire deposition of the complainant is contrary and in stark contrast to the entire case setup by the complainant in her complaint and same goes to the very root of the matter as the complainant approached this Court stating that the accused gained her trust being her neighbour and thereby she advanced a sum of ₹2,50,000/- to him in 2017, however, in the cross-examination, she herself deposed that she hardly had talking terms with the accused and the loan amount was not advanced to the accused but to his wife, in different installments. It is again to be emphasized no date has been mentioned nor any documentary/ocular proof of lending a sum of ₹2,50,000/- was brought in by the complainant.
27. It is also improbable and has not been explained as to why 4 cheques were taken for a sum of ₹2,50,000/- and not a single cheque of the entire transaction was taken and that too of one single bank. A question comes to the mind of this Court considering the entire deposition of the complainant as whether the complainant was taking a cheque from the wife of the accused every time, she gave money to her and if so, then why the cheque of the husband of the accused was taken and not the accused. Also, if the loan was advanced in 2017 and the cheques were also taken at that time then why date of 2022 i.e., Digitally signed by NORMA CC No. 7556/2022 NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 12 of 20 JAIN Date:
2024.08.29 13:29:35 +0530 CNR No.: DLST02-039316-2022 after 5 years was got filled in by the wife of the accused (as per the complainant, date was filled by the wife at the time she gave the cheques) on the cheques in question, was there a term between the parties that the cheques will be encashed after 5 years and if the case was so, why then the complainant was approaching the accused and/his wife for repayment of the loan.
28. All these questions which have occurred in the mind of this Court after perusing the cross-examination of the complainant have created doubts in the mind of this Court qua the story of the complainant and the complainant has not been able to clear that mist.
29. Thirdly, the Ld. Counsel for the accused also questioned the financial capacity of the complainant by asking the source of income of the complainant. The complainant in the cross-examination stated that she is a homemaker and she and her husband used to get rental income of Rs.15,000-16,000/-. The complainant also stated during the cross-examination that she is not an income tax payee and the entire loan amount was given to the wife of the accused in cash which she saved for the marriage of her daughter.
30. The complainant in her complaint as well as affidavit Ex. CW1/A stated that she arranged the loan amount, how the loan amount was arranged by the complainant has not been specified either in the complaint or the affidavit nor anything regarding the arrangement was stated by the complainant in her cross-examination and she simply stated that she had cash at home which she saved. No documentary proof was further filed showing the rental income of the complainant as well as her husband.
31. The Hon'ble Supreme Court in catena of judgments held that in Digitally CC No. 7556/2022 signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 13 of 20 JAIN Date:
2024.08.29 13:29:40 +0530 CNR No.: DLST02-039316-2022 cases where the loan is stated to be advanced in cash by the complainant and the accused raises questions about the financial capacity of the complainant, then the burden shifts on the complainant to prove his financial capacity. Reliance in this regard is placed on the judgment of the Hon'ble Supreme Court in Basalingappa (supra), wherein the Court observed:
30. We are of the view that when evidence was led before the court to indicate that apart from loan of Rs 6 lakhs given to the accused, within 2 years, amount of Rs 18 lakhs have been given out by the complainant and his financial capacity being questioned, it was incumbent on the complainant to have explained his financial capacity. Court cannot insist on a person to lead negative evidence. The observation of the High Court that trial court's finding that the complainant failed to prove his financial capacity of lending money is perverse, cannot be supported. We fail to see that how the trial court's findings can be termed as perverse by the High Court when it was based on consideration of the evidence, which was led on behalf of the defence.
32. The High Court without discarding the evidence, which was led by defence could not have held that the finding of trial court regarding financial capacity of the complainant is perverse. We are, thus, satisfied that the accused has raised a probable defence and the findings of the trial court that the complainant failed to prove his financial capacity are based on evidence led by the defence. The observations of the High Court that findings of the trial court are perverse are unsustainable. We, thus, are of the view that judgment of the High Court is unsustainable.
32. Further, the Hon'ble Supreme Court in the case of Tedhi Singh Versus Narayan Dass Mahant Criminal Appeal No.362 Of 2022 (Arising Out Of Slp (Crl) No.1963 Of 2019) (Date Of Decision:7th March, 2022) held that:
7. It is true that this is a case under Section 138 of the Negotiable Instruments Act. Section 139 of the N.I. Act provides that Court shall presume that the holder of a cheque received the cheque of the nature referred to in Section 138 for the discharge, in whole or in part, of any debt or other liability. This presumption, however, is expressly made subject to the position CC No. 7556/2022 Digitally Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 14 of 20 signed by NORMA NORMA Date:
JAIN JAIN 2024.08.29 13:29:46 +0530 CNR No.: DLST02-039316-2022 being proved to the contrary. In other words, it is open to the accused to establish that there is no consideration received. It is in the context of this provision that the theory of 'probable defence' has grown. In an earlier judgment, in fact, which has also been adverted to in Basalingappa (supra), this Court notes that Section 139 of the N.I. Act is an example of reverse onus [see (2010) 11 SCC 441). It is also true that this Court has found that the accused is not expected to discharge an unduly high standard of proof. It is accordingly that the principle has developed that all which the accused needs to establish is a probable defence. As to whether a probable defence has been established is a matter to be decided on the facts of each case on the conspectus of evidence and circumstances that exist.
9. The Trial Court and the First Appellate Court have noted that in the case under Section 138 of the N. I. Act the complainant need not show in the first instance that he had the capacity. The proceedings under Section 138 of the N. I. Act is not a civil suit.
At the time, when the complainant gives his evidence, unless a case is set up in the reply notice to the statutory notice sent, that the complainant did not have the wherewithal, it cannot be expected of the complainant to initially lead evidence to show that he had the financial capacity. To that extent the Courts in our view were right in holding on those lines. However, the accused has the right to demonstrate that the complainant in a particular case did not have the capacity and therefore, the case of the accused is acceptable which he can do by producing independent materials, namely, by examining his witnesses and producing documents. It is also open to him to establish the very same aspect by pointing to the materials produced by the complainant himself. He can further, more importantly, achieve this result through the cross examination of the witnesses of the complainant. Ultimately, it becomes the duty of the Courts to consider carefully and appreciate the totality of the evidence and then come to a conclusion whether in the given case, the accused has shown that the case of the complainant is in peril for the reason that the accused has established a probable defence.
33. Reliance is also placed by this Court on the judgment of Aps Forex Services Pvt. Ltd. Versus Shakti International Fashion Linkers & Ors. 2020 0 Supreme (SC) 155, wherein the Hon'ble Supreme Court held that:
"6.4 Now so far as the reliance is placed by Learned Counsel CC No. 7556/2022 Digitally signed by Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 15 of 20 NORMA NORMA Date:
JAIN JAIN 2024.08.29 13:29:54 +0530 CNR No.: DLST02-039316-2022 appearing on behalf of the accused on the decision of this Court in the case of Basalingappa (supra), on going through the said decision, we are of the opinion that the said decision shall not be applicable to the facts of the case on hand and/or the same shall not be of any assistance to the accused. In that case before this Court, the defence by the accused was that the cheque amount was given by the complainant to the accused by way of loan. When the proceedings were initiated under Section 138 of the N.I. Act the accused denied the debt liability and the accused raised the defence and questioned the financial capacity of the complainant. To that, the complainant failed to prove and establish his financial capacity. Therefore, this Court was satisfied that the accused had a probable defence and consequently in absence of complainant having failed to prove his financial capacity, this Court acquitted the accused. In the present case, the accused never questioned the financial capacity of the complainant. We are of the view that whenever the accused has questioned the financial capacity of the complainant in support of his probable defence, despite the presumption under Section 139 of the N.I. Act about the presumption of legally enforceable debt and such presumption is rebuttable, thereafter the onus shifts again on the complainant to prove his financial capacity and at that stage the complainant is required to lead the evidence to prove his financial capacity, more particularly when it is a case of giving loan by cash and thereafter issuance of a cheque. That is not a case here."
34. Once the accused challenges the financial capacity of the complainant, it is on the complainant to show that at the relevant period, he had the financial capacity to pay the loan amount to the accused. In the present case though the Ld. Counsel for the complainant argued that the accused has admitted that the wife of the accused took a sum of ₹1,50,000/- from the complainant, however, the complainant has approached this Court for a sum of ₹2,50,000/- and once the same has been challenged by the accused, it was on her to prove that at the relevant period, she had the financial capacity to pay the loan amount to the accused, which she failed to prove.
35. Fourthly, the present matter pertains to 4 cheques i.e. Ex. CW1/1, Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5. 3 cheques i.e. Ex.
Digitally
CC No. 7556/2022 signed by
NORMA
Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 16 of 20 NORMA
JAIN
JAIN
Date:
2024.08.29
13:29:58
+0530
CNR No.: DLST02-039316-2022
CW1/3, Ex. CW1/4 and Ex. CW1/5 were drawn on the Corporation Bank and returned dishonoured vide return memo Ex. CW1/6 wherein the reason for return of the same is stated to be 'Corporation Bank merged with Union Bank, cheque invalid'.
36. Corporation Bank merged with the Union Bank of India on 01.04.2020 and it was thereafter published in all the newspapers that the cheques of Corporation Bank will not be valid from 30.06.2021. Ex. CW1/6 shows that the cheques are dated 17.09.2022 which means that they were presented after the period of their validity and on the date of their presentation, they were not a valid negotiable instrument and accordingly, they returned with remarks 'invalid cheque'.
37. As per Section 138 of NI Act, it is important that the cheque should be presented within the period of its validity. However, the three cheques in question i.e., Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5 were not a valid negotiable instrument on the date of its presentation. Considering the same, second ingredient as specified in para no.10 cannot be said to be fulfilled qua these cheques i.e., Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5.
38. Fifthly, the Ld. Counsel for the accused argued that the reason for dishonour of cheques Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5 cannot be said to be covered under Section 138 of NI Act as the said cheques returned dishonoured not because of the reasons specified in Section 138 of NI Act but for the reason beyond the control of the drawer.
39. On the other hand, Ld. Counsel for the complainant argued that the reasons for dishonour of the cheques have been expanded by various judgments and thereby, the reason as stated in Ex. CW1/6 will Digitally CC No. 7556/2022 signed by NORMA Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 17 of 20 NORMA JAIN JAIN Date:
2024.08.29 13:30:03 +0530 CNR No.: DLST02-039316-2022 also be covered under Section 138 of NI Act.
40. Section 138 of NI Act envisages two contingencies constituting dishonor of cheque i.e., if the cheque is returned by the bank 'unpaid' either because the amount of money standing to the credit of the drawer's account is insufficient to honour the cheque or that the amount exceeds the amount arranged to be paid from that account by an agreement with that bank. These contingencies were expanded by the Hon'ble Supreme Court in the judgment of M/S Laxmi Dyechem Versus State Of Gujarat & Ors. Criminal Appeal Nos. 1870-1909 of 2012 (arising Out S.L.P. (Crl.) Nos. 1740-1779 Of 2011) by including in it various other contingencies wherein the cheque had been dishonoured because of the omission and/or act of the drawer.
41. In the present case, cheque Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5 dishonored because of the merger of Corporation Bank into Union Bank of India, the cheques becoming invalid on the date of its presentation. Even if the accused would have maintained sufficient funds in his account, then also the cheques would have returned for the same reason.
42. The object of Chapter XXVII of the NI Act is to punish dishonest drawer who get the cheque issued by him dishonoured by his act/omission/conduct, the same is not to punish a drawer whose cheque get dishonour because of reason beyond his control.
43. Considering the discussion held above, I am of the view that as the cheques Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5 got dishonoured because of bank merger, the said reason cannot be said to fall in one of the reasons to constitute offence under Section 138 of NI Act and the third ingredient mentioned in para no.10 of this judgment cannot be Digitally CC No. 7556/2022 signed by NORMA NORMA JAIN Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 18 of 20 JAIN Date:
2024.08.29 13:30:07 +0530 CNR No.: DLST02-039316-2022 said to be fulfilled qua cheques i.e., Ex. CW1/3, Ex. CW1/4 and Ex. CW1/5.
FINAL ORDER
44. It is imperative to understand that in order to pronounce a conviction in a criminal case, the accused 'must be' guilty and not merely 'may be' guilty. For an accused to be guilty, guilt should not be based on mere surmises and conjectures but it should be based on cogent evidence.
45. Merely because the cheque was issued from an account maintained by the accused or that the accused is unable to give any reasonable explanation regarding the possession of the cheque by the complainant or that the accused has admitted receipt of some loan from the complainant would not invite the culpability under Section 138 of the NI Act and the complainant is required to prove his case beyond reasonable doubt. The accused was required to destabilize the law of presumption on the scale of preponderance of probabilities and he has successfully done that as apparent from the record and from the evidence led during the trial.
46. Upon comprehensive appreciation of the evidence led on record, it appears that neither the capacity of the complainant to advance the alleged loan nor the existence of debt or liability has been proved on record by the complainant beyond reasonable doubt and accused has been successful in raising a "probable defence" and strong suspicion over the case put forth by prosecution. The foundational facts required to attract liability under Section 138 of NI Act have also not been fulfilled by the complainant.
47. In view of the above discussion and in view of the judgments of Digitally CC No. 7556/2022 signed by NORMA Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 19 of 20 NORMA JAIN JAIN Date:
2024.08.29 13:30:12 +0530 CNR No.: DLST02-039316-2022 Hon'ble Superior Courts as stated above, the accused has been able to raise a probable defence and has been able to prove his defence on the basis of preponderance of probabilities. Thus, the accused has been able to rebut the presumption under Section 118 read with Section 139 of NI Act. On the other hand, the complainant has failed to prove her case beyond reasonable doubt qua the accused in respect of the cheques in question.
48. In view of the aforesaid discussion, accused Rajinder Kumar Beserwal S/o Sh. Tulshi Ram Beserwal is hereby acquitted of offence under Section 138 of Negotiable Instruments Act.
Digitally signed by NORMANORMA JAIN JAIN Date:
2024.08.29 13:30:15 +0530 (Norma Jain) Announced in Open Court MM (NI Act) Digital Court-01 on 29.08.2024 South, Saket Courts, New Delhi Note: This judgment contains 20 signed pages and each page has been signed by the undersigned. NORMA Digitally signed by NORMA JAIN JAIN Date:2024.08.29 13:30:18 +0530
(Norma Jain) MM (NI Act) Digital Court-01 South, Saket Courts, New Delhi 29.08.2024 CC No. 7556/2022 Ganga Devi Vs. Rajinder Kumar Beserwal Page No. 20 of 20