Delhi District Court
M/S Senior Builder Limited vs Rajesh Sharma on 23 July, 2016
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IN THE COURT OF SH. GURDEEP SINGH,
SPECIAL JUDGE (PC ACT), CBI-05 PATIALA HOUSE COURTS,
NEW DELHI.
CA No. : 32/15
Unique Case ID no. : 02403R00196642015
1. M/s Senior Builder Limited.
B-109, Defence Colony
New Delhi - 110 024
2. Vijay Dixit
S/o Sh. C.L. Dixit
B-109, Defence Colony
New Delhi - 110 024
Presently: Confined in Central Jail No. 3,
Tihar, New Delhi ... Appellant
Vs.
Rajesh Sharma
BL-17C, Shalimar Bagh
Delhi - 110 052
(through S.P.A. Sh. Bal Mukund Sharma) ....Respondent
Date of Institution : 07.10.2015
Date of arguments : 16.07.2016
Date of pronouncement : 23.07.2016
ORDER
1. Vide this order, I shall decide the appeal preferred against order passed by learned MM for offence punishable under Section 138 of Negotiable Instruments Act (in short N.I. Act) whereby, M/ Senior CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 1 of 12 :: 2 ::
Builders Limited (herein referred to as appellant no. 1) and Vijay Dixit (herein referred to as appellant no. 2) were sentenced to pay fine of Rs.4.50 lacs (Rs.10000/- to be deposited with the court and remainig Rs.4.40 lacs to be paid to the respondent as compensation) and in default to undergo simple imprisonment for one month; appellant no. 2 was further sentenced to undergo rigorous imprisonment for 15 days
2. The relevant facts for the disposal of appeal are that complaint for offence punishable under Section 138 N.I. Act was filed against appellants no. 1 and 2 stating therein that appellant no. 1 is a public limited company and remaining accused are its directors and fully responsible for its day to day working and management. Appellant no.1 is engaged in the business of real estate development works and had proposed to start a project for construction of dwelling units in Sonipat. Respondent applied for the allotment of 260 sq. yards plot , for which he paid a sum of Rs.3.50 lacs by way of cheque of Corporation Bank which was duly acknowledged by appellant no. 1. Further, the project failed. Coming to know of the failure of the project, respondent demanded for refund of amount; on which, appellant issued a payee cheque for Rs.3.50 lacs on 05.02.2011, after utilising the CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 2 of 12 :: 3 ::
amount for around 6 years. The cheque on presentation was dishonoured with remarks "insufficient funds". Thereafter, a legal notice dated 04.03.2011 was sent to appellant, but despite that the amount was not paid. Hence, the complaint was filed .
3. Learned MM after recording pre-summoning evidence summoned the appellants vide order dated 02.09.2011. Notice under Section 251 Cr. P.C. was framed upon appellants vide orders dated 19.08.2013 and 30.09.2013. Respondent examined Sh. Bal Mukund Sharma, holder of special power of attorney. Statement of appellants were recorded whereby, they denied that they deceived respondent of Rs.3.50 lacs. However, they stated that payment was made by the respondent as booking amount only and subsequently, the respondent failed to pay the remaining amount. The project did not fail; the entire land was acquired by the Government of Haryana and against the acquisition they had moved before Punjab & Haryana High Court. It was further stated that whoever had surrendered the land was paid Rs.4 lacs as per the settlement; Rs.4 lacs was also paid to the respondent and the cheque in question was not issued in discharge of any legally enforceable debt. It was further stated that original complainant, that is, Rajesh Sharma never appeared CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 3 of 12 :: 4 ::
and Sh. Bal Mukund Sharma is not the duly authorized attorney of Sh. Rajesh Sharma.
4. I have heard Sh. Arun Srivastava, Advocate for appellant and learned counsel for respondent and have gone through the record carefully.
5. The order of learned MM is assailed on the ground that Sh. Bal Mukund Sharma has no authority to file the complaint, as there was no valid attorney executed by the respondent in his favour. It is submitted that as per judgment of Apex Court in A.C. Narayanan V. State of Maharashtra & Anr. [2013(4) JCC (NI) 214] wherein, it was held that holder of power of attorney can file and pursue the complaint under Section 138 N.I. Act only when he has the personal knowledge of complaint. It is also stated that no notice was ever served and notice was sent to appellant no. 1 at wrong address. Learned counsel for appellant submitted that he may be permitted to argue additional ground and submitted that as per the complaint, payment was made vide cheque dated 08.04.2005 whereas, the present cheque was given on 05.02.2011 which is after the period of limitation. Learned counsel further submitted that he has not taken the ground, but he may be allowed to make submissions on additional ground. He submitted CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 4 of 12 :: 5 ::
that it is time barred and is not legally recoverable and hence, offence under Section 138 N.I. Act is not made out. Learned counsel cited Prajan Kumar Jain V. Ravi Malhotra [2010(1) BC 8], Vijay Polymers Pvt. Limited & Anr. V. Vinnay Aggarwal [2010(2) DCR 534] and Manjit Singh V. S.K. Mehta & Co. [2014(214) DLT 376], in support of submissions.
6. Firstly, coming to the issue of power of attorney.
Special power of attorney in this case is signed by Rajesh Sharma however, below the signatures, Kamlesh Sharma is written as Executent. It appears to be a typographical error as the first page of the special power of attorney categorically mentions name of Rajesh Sharma being executent and the same is also signed by him. It appears that it is a typographical mistake as the name of the executent is written as Kamlesh Sharma on typing. So there cannot be any dispute that same was executed by Rajesh Sharma.
7. Now, the next question is whether power of attorney holder can depose on behalf of the complainant. The affidavit Ex.CW1/II categorically mentions that Sh. Bal Mukund Sharma is the holder of special power of attorney and as such was conversant with the facts of the case. In his cross-examination, he categorically CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 5 of 12 :: 6 ::
stated that he know all the facts. However, he admitted that cheque was not presented/ handed over to appellant no. 2 and the same was handed over to some staff. He denied the suggestion that cheque was given to appellant for security. From the cross- examination, it is apparent that he was aware of the facts of the case as he deposed regarding failure of the scheme and purpose of the cheque. He denied the suggestion that special power of attorney was executed by Kamlesh Sharma. Hon'ble Supreme Court in A.C. Narayanan's case (supra) was called upon to decide whether holder of power of attorney can sign and file the complaint on behalf of the complainant and whether he can depose w.r.t. the same. Hon'ble Supreme Court came to conclusion that filing of complaint through holder of power of attorney is perfectly legal. However, he must witness the transaction or possess due knowledge regarding the said transaction to stand witness. In the said case, the question before the court was w.r.t. power of attorney. Even in the case where the person is holder of power of attorney, he is competent to file the complaint and also depose, in case he has witnessed the transaction.
8. Further, learned MM while dealing with the issue whether holder of power of attorney can file the CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 6 of 12 :: 7 ::
complaint and depose in the Court observed as under:
"17. In Shankar Finance and Investments Vs. State of Andhra Pradesh & Ors. (2008) 8 SCC 536 also the Hon'ble Supreme Court has held that a complaint u/s 138 N.I. Act filed by the complainant through a POAH is valid and maintainable. But the only requirement is that the complaint must have been filed in the name of the complainant and a POAH can not file a complaint in his own name. In fact the Hon'ble Supreme Court had even observed in para 12 as follows "But where the attorney holder of the complainant is in charge of th ebusiness of the payee- complaint and the Attorney holder alone is personally aware of the transactions, and the complaint is signed by the attorney holder on behalf of the payee-complainant, there is no reason why the attorney holder cannot be examined as the complainant".
Therefore, even if the complaint has been signed by POAH and not by the complainant, then also the complaint is very well maintainable and the complaint can not be dismissed on this ground only. Hence, this defence raised by Ld. Counsel for the accused in not maintainable and stands overruled. .."
Learned MM correctly applied the law on the facts.
9. Coming to the submission regarding security. Nothing apart from a bald statement that cheque was given for security is mentioned. Whereas, the respondent CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 7 of 12 :: 8 ::
categorically stated that he had paid amount of Rs.3.50 lacs for booking of the plot and after six years, appellant gave him cheque of Rs.3.50 lacs as refund. Admittedly, the appellant has not stood in the witness box to prove the same. It cannot be gathered from anywhere that cheque in question was towards security. The issuance of cheque has been admitted and presumption raised against the appellant is unrebutted.
10.Now, coming to the issue of legal notice. It is stated on behalf of respondent that legal notice was issued in the name of appellant no. 1 at the address 1/1, Shanti Niketan, New Delhi - 110 021. Except a bald statement that notice was not issued at the correct address, nothing has come on record to show that notice was not sent at the correct address. On the other hand, respondent has proved receipt as well as UPC which are issued at the above mentioned address. Further, the photocopy of receipt Mark CW1/1 issued by appellant no. 1 in lieu of receipt of amount of Rs.3.50 lacs also mentions the address of registered office at "1/1, Shanti Niketan, New Delhi" and office of corp. office at "B-109, Defence Colony, New Delhi". It is pertinent to mention here that in the appeal filed by the appellant, the address is given as "B-109, Defence CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 8 of 12 :: 9 ::
Colony, New Delhi", that is, the same address mentioned on Ex.CW1/1 with the address on which the legal notice was issued.
11.Lastly, regarding debt being time barred and not recoverable, in the cited judgment of Prajan Kumar Jain (supra), the settlement had taken place on 26.01.2005 whereby, acknowledgment was made to pay the balance amount. The fact in the said case was that agreement dated 14.06.2000 was entered into between the complainant and the accused for purchase of agricultural land for consideration of 2.30 crores and Rs.30 lacs was paid by the complainant to the accused and his brother. Thereafter, parties agreed to terminate the agreement and the accused and his brother promised to return Rs.30 lacs. This agreement took place on 26.01.2005 on which date, accused had acknowledged to pay the balance amount. It was in discharge of liability of debt arising out of the agreement dated 14.06.2000. The amount was paid after four and a half years after the termination of the agreement and, therefore, the acknowledgment became time barred. On those facts, Hon'ble High Court held that debt was time barred and was not legally recoverable. The debt has become time barred and hence, not legally recoverable as per Section 138 CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 9 of 12 :: 10 ::
of N.I. Act.
12.Similarly, in case of Vijay Polymers Pvt. Limited (supra), personal loan was given to accused in January, 2002, who promised to repay the same within six months. After persuasion, the cheques was given on 27.04.2006 and thereafter, another cheque was issued on 05.05.2007 which was dishonoured. On those facts, it was held that the acknowledgment as per Section 18 of the Limitation Act, must be before period of limitation is over.
13.In the case of Manjit Singh (supra), the bill was issued on 03.03.2003 and cheque was issued on 03.09.2007 and, therefore, it was time barred. On those facts, Hon'ble High Court held that whether the recovery of amount is within the limitation period, it was a question of triable issue and parties were directed to lead evidence before trial court.
14.In the present case, as per the complaint, payment was made on 08.04.2005 for allotment of 260 sq. yard of plot. The project failed ultimately and in return of the same, the cheque was issued by the appellant. The question therefore would be as to when the breach of contract occurred as it was continuing contract to allot CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 10 of 12 :: 11 ::
the plot. In the cross-examination, not even a single question has been asked as to when the contract was terminated. In statement of accused under Section 313 Cr. P.C. also, it is mentioned that respondent himself failed to honour the terms and conditions of the allotment however, the appellant agreed to settle the matter with the appellant, but he has not led any evidence as to when the contract got terminated or settlement had arrived at. Article 54 of Limitation Act provides the period of limitation when the time begins to run for a specific performance of a contract as 3 years from the date fixed for performance, if no such date is fixed, when the plaintiff has notice that performance is refused. Similarly as per Article 55, for compensation for breach of contract, it is 3 years and when the time begins to run when the contract is broken and breaches in respect of which the suit is instituted occurs or when it ceases.
15.In the present case, as it was for allotment of the plot, the breach was continuing till it was refused and, therefore, under both the Articles, the period of limitation will not be as per ordinary money suit. In the cited cases, the money due had become crystalised after the settlement when the agreement was terminated or when the money had become due for CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 11 of 12 :: 12 ::
payment. Therefore, the cited judgments are not of any help to appellant as per the record and evidence.
16.Accordingly, I find no infirmity or illegality in the order of learned MM. The order of conviction is upheld. Further, the State had not suffered any loss in this case. Therefore, the order on sentence is modified to the extent that appellant is not required to deposit Rs.10,000/- with the Court and shall pay the entire amount of compensation to the respondent. The amount deposited be released in favour of respondent qua part of compensation.
The appellant no. 2 is lodged in Tihar Jail. Let copy of this order be sent to Superintendent, Tihar Jail for execution of sentence. Copy of this order be also sent to learned MM for the purpose of execution of sentence of appellant no. 1 company.
Trial Court Record be sent back along with the copy of this order.
Appeal file be consigned to record room.
Announced in the open court on (GURDEEP SINGH) 23rd July, 2016 ADDITIONAL SESSIONS JDUGE SPECIAL JUDGE (PC ACT): CBI-05 NEW DELHI/ 23.07.2016 CA No. 32/15 M/s Senior Builder Limited Vs. Rajesh Sharma Page No. 12 of 12