Delhi District Court
Cnr. Dlct020302852018 Biman Mukherjee vs Narayan Giri Page 1 Of 30 on 20 December, 2021
CC No. 700/2019
CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 1 of 30
IN THE COURT OF SH. VISVESH, METROPOLITAN
MAGISTRATE, N.I. ACT-06, CENTRAL, TIS
HAZARI COURTS, DELHI
CNR. DLCT020012372019
CC No. 700/2019
Sh. Biman Mukherjee
H.No. 6698, Block-9, Gali No. 8
Pyarelal Marg, Dev Nagar
Karol Bagh, New Delhi -110005 ...... Complainant
Vs.
Sh. Narayan Giri
(Prop. M/s Nirmala Jewellers)
H. No. 6576, Block No.9, Gali No. 3
Dev Nagar, Karol Bagh
New Delhi- 110005
Also, at:
Nirmala Jewellers
3811/21-22, Vishnu Mandir Marg
Reghar Pura, Karol Bagh
New Delhi -110005 ...... Accused
Date of Institution : 14.01.2019
Offence complained of : s.138 of The Negotiable Instruments
Act,1881
Plea of the Accused : Not Guilty
Final Order : Acquitted
Date of Decision : 20.12.2021
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CC No. 700/2019
CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 2 of 30
JUDGEMENT
1. The present Complaint has been filed by the Complainant against the Accused under section 138 Negotiable Instruments Act, 1881.
Factual Matrix
2. The brief facts as alleged by the Complainant in the Complaint are that the Complainant and the Accused are known to each other for more than a decade and are also, neighbours. It has also been stated that the Complainant has always tried to support the Accused financially and in the year 2016, the Accused had requested the Complainant for financial help and had demanded a loan of ₹ 15 lakh as a friendly loan for the purposes of expansion of business and to repay the commercial creditors of the Accused. Further, it has been stated that the Accused assured the Complainant that the aforesaid loan shall be paid along with interest based on good faith and trust and a total amount of ₹ 15 lakh was disbursed to the Accused in cash at various intervals of time.
2.1 Thereafter, it has been stated that in the month of June 2018, the Complainant visited the Accused and demanded back his money. Pursuant to the same, it has been stated that the Accused issued three cheques, one of which is the subject matter of the present case, i.e., post-dated cheque bearing number 497658 dated 12th of November 2018 for an amount of ₹ 5 lakh and drawn on United Bank of India, Karol Bagh branch.
Page 2 of 30Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 3 of 30 2.2 When the Complainant presented the said cheque, hereinafter referred to as the cheque in question through his banker Axis bank, Karol Bagh branch, the same was returned unpaid by the banker of the Accused vide returning memo dated 14th of November 2018 with the remarks "Funds Insufficient".
2.3 The Complainant thereafter issued a legal demand notice on 05th of December 2018 through counsel calling upon the Accused to pay the said cheque amount within a period of 15 days from receipt thereof. The said notice was stated to be duly served upon the Accused and it has been alleged that the Accused failed to pay the aforesaid cheque amount within the statutory period.
2.4 Hence, the present Complaint u/s 138 Negotiable Instrument Act 1881 (hereinafter the NI Act) was filed on 14th of January 2019 by the Complainant, praying for the Accused to be summoned, tried, and punished for commission of the offence u/s 138 of the Negotiable Instruments Act, 1881. The Complainant has averred that the present Complaint is within the period of limitation and falls within the territorial limits of this Court's jurisdiction; thus, being tenable at law.
Proceedings before the Court
3. Pre-summoning Evidence: To prove a prima-facie case, the Complainant led pre-summoning evidence by way of affidavit Ex. CW-1/A wherein the Complainant has affirmed the facts stated in the instant Complaint.
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4. Documentary Evidence: To prove the case, the Complainant has relied upon the following documents:
a) Original cheque bearing no. 497658 dated 12th of November 2018 for a sum of ₹ 5 lakh drawn on United Bank of India Bank, Karol Bagh Branch, Ex. CW1/1.
b) Original cheque return memo dated 14th of November 2018, Ex. CW-1/2.
c) Office Copy of legal notice dated 5th of December 2018, Ex. CW1/3.
d) Postal receipts and track reports, Ex. CW1/5 - Ex.
CW1/6.
e) Record of previously filed complaint against the Accused containing the previously given cheques, return memo, legal demand notice and its reply, postal receipts, track reports etc., Ex. CW1/7 - Ex. CW 1/16. (Note: The said documents already form subject matter of CC No. 17450/2018 decided between the same parties)
5. Summoning of the Accused: On finding of a prima-facie case against the Accused, the Accused was summoned on 21st of January 2019 where the Accused appeared before the Court on 16th of February 2019.
6. Framing of notice & plea of defence: Notice u/s 251 Cr.P.C. was framed against the Accused on 16th of February 2019 to which he pleaded not guilty and claimed trial. The plea of defence of the Accused was recorded where the Accused had admitted his signature on the cheques in question. The receipt of the legal demand notice was denied but the address appearing on it was admitted to be correct. The Accused stated that he had taken a loan of ₹ 30 lakh Page 4 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 5 of 30 from the Complainant, from 2009 to 2012 and had issued seven security cheques to the Complainant. It was also stated that he has already repaid the loan amount with interest by 2017. Further, he had requested the Complainant to return his remaining cheques, but the Complainant stated that he will return it later. Lastly, it was stated that the Complainant has misused the cheque in question and filed the present complaint.
7. Evidence of the Complainant: After the framing of notice, the Accused was granted permission to cross-examine the Complainant. Thereafter, the Complainant was examined as CW1, adopting the pre-summoning evidence as post-summoning evidence and was cross examined and discharged. No other witnesses were examined by the Complainant. Thereafter, Complainant evidence was closed, and the matter was listed for statement of the Accused u/s 313 Cr.P.C. r/w Section 281 Cr.P.C.
8. Statement of the Accused: Statement of the Accused was recorded u/s 313 Cr.P.C. r/w Section 281 Cr.P.C on 24th of July 2019 wherein all the incriminating circumstances appearing in evidence against the Accused were put to him to which the Accused stated that the cheque in question was issued as blank signed cheque to the Complainant and he came to know about the dishonour when the summons were received by him. Receipt of the legal demand notice was denied and it was stated that he had taken a loan of ₹ 30 lakh at 1% per month from the Complainant from the year 2009 to 2012 which he had repaid the Complainant. He then stated that from the Page 5 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 6 of 30 year 2015 till the year 2017, he had returned a total amount of ₹ 32 Lakhs to the complainant out of which the complainant returned him an amount of ₹ 2 lakh in the year 2017 by crediting the same in his bank account. It was also stated that the payment of ₹ 32 lakhs was made by him in the bank account of the complainant and that he had issued a total of seven blank signed security cheques to the complainant. Further, he stated that he had asked the complainant to return the security cheque however he did not return the same. The accused categorically denied any liability towards the complainant and stated that he had paid an amount of ₹ 16,81,000 to the complainant as interest on the aforesaid loan in the bank account of the complainant and stated that he can bring the bank account statements for showing the aforesaid payments.
9. Defence Evidence: The Accused has examined DW-1 i.e., Bank Witness Sh. Vinod Pathak and DW-2 i.e., Record Clerk/Ahlmad Sh. Bhushan Kumar in his defence. Thereafter, Defence Evidence was closed when a separate statement of the Accused to that effect was recorded. The matter was then fixed for final arguments.
10.Final Arguments: Final arguments were advanced by both sides. I have heard the submissions of the Ld. Counsel for the Complainant as well as the Accused. I have also perused the record. The Ld. Counsel for the Complainant has relied upon the following judgements:
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(a) Kusum Ingots Vs. Pennar Peterson Securities 1
(b) K.N. Beena Vs. Muniyappan2
(c) SAIL Vs. B.D. Aggarwal & Sons3
(d) Rangappa Vs. Sri Mohan 4 The Ld. Counsel for the Accused has relied upon the following judgements:
(a) H. Manjunath Vs. A.M. Basavaraju5
(b) K.N. Beena Vs. Muniyappan6 Legal Position
11.For the application of s.138 of the Negotiable Instruments Act, 1881, the following legal requirements must be satisfied from the averments in the Complaint as well as the evidence of the Complainant: -
(a) That a person has drawn a cheque, 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 legally enforceable debt or other liability;
(b) That the cheque has been presented to the bank within a period of three months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(c) That the cheque has been returned by the drawee bank unpaid, for the reason that 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 1 2000(2) SCC 745 2 2001 (8) SCC 458 3 2002 CriLJ 382 (Punjab & Haryana) 4 infra 5 infra 6 supra Page 7 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 8 of 30 agreement made with that bank;
(d) That the payee or holder in due course has made a demand for payment of the said amount of money by giving a notice in writing to the drawer of the cheque within 30 days of receipt of information from the bank regarding the return of the cheque as unpaid;
(e) That the drawer of the cheque fails to make the payment of the said amount of money to the payee or holder in due course within 15 days of receipt of the said notice;
11.1. The aforesaid legal requirements are cumulative in nature, i.e. only when all of the aforementioned ingredients are duly proved is the drawer of the cheque deemed to have committed an offence under s. 138 of the Negotiable Instruments Act.
11.2. The provision of s.138 is buttressed by s.139 and s.118 of the Act.
s. 139 of the Act provides that the Court shall presume, that the holder of a cheque received the cheque for the discharge, wholly or in part of any debt or other liability. s.118 of the Act provides inter alia that the Court shall presume, until the contrary is proved, that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration.
11.3. What follows from the aforesaid is that the offence u/s 138 of the Negotiable Instruments Act operates on reverse onus of proof theory. The presumptions u/s 139 and s. 118 of the Act mandate the Court to draw them, when a given set of facts are shown to exist. The same is evident by the peremptory language "Shall Presume"
Page 8 of 30Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 9 of 30 used. However, the said presumptions are rebuttable in nature, i.e. it is open for the defence to disprove the same by establishing facts to the contrary.
11.4. In the case of Hiten P. Dalal v. Bratindranath Banerjee7, the Hon'ble Supreme Court had occasion to examine the confines of the presumption u/s 139 of the Act, wherein it held as follows:
"22. Because both Sections 138 and 139 (..) "introduce an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the Accused."
(Ibid. at p. 65, para 14.) (...) The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the Accused adduces evidence showing the reasonable possibility of the non- existence of the presumed fact.
Therefore, 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 the case of a mandatory presumption, the burden resting on the Accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the Accused is reasonable and probable. It must further be shown that the explanation is a true one. ........ Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted". (emphasis supplied).
7(2001) 6 SCC 16 Page 9 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 10 of 30 11.5. Also, in the case of Rangappa v. Sri Mohan8, it was held that:
"(..)we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. (..)
28. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an Accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of "preponderance of probabilities".
(...) As clarified in the citations, the Accused can rely on the materials submitted by the Complainant in order to raise such a defence and it is conceivable that in some cases the Accused may not need to adduce evidence of his/her own(...)"(emphasis supplied) 11.6. With regard to the factors taken into account for rebutting the presumption u/s 139 read with s.118 of the Act, the judgement of Hon'ble Delhi High Court in V.S. Yadav v. Reena 9 assumes importance, wherein it was held that:
"Mere pleading not guilty and stating that the cheques were issued as security, would not amount to rebutting the presumption raised under Section 139 of N.I. Act. (...) The Accused, by cogent evidence, has to prove the circumstance under which cheques were issued". (emphasis supplied) Appreciation of evidence
12.Now I shall proceed to deal with the legal ingredients one by one and give my finding on whether the evidence on record satisfies the 8 (2010) 11 SCC 441 9 CRL. A. No. 1136 Of 2010 Page 10 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 11 of 30 legal ingredient in question or not.
(a) That a person has drawn a cheque, 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 legally enforceable debt or other liability 12.1.This condition pertains to the issuance of the cheque itself. It is pertinent to note that the Accused, in his notice of accusation has admitted his signature on the cheque in question. Further, the cheque has been drawn on the account of the Accused. This leads to drawing of an inference u/s 139 read with s.118 of the Act, that the cheque was issued in discharge of a legally recoverable debt or other liability.
12.2.In the case of Bharat Barrel & Drum Mfg. Co. v. Amin Chand Pyarelal 10, it was held:
"12. (...) the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a consideration by raising a probable defence. The Court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff.10
(1999) 3 SCC 35 Page 11 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 12 of 30 (emphasis supplied)"
12.3. Also, in the case of Kumar Exports Vs. Sharma Carpets 11, it was held:
"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 produced evidence fairly and reasonably tending to show that the real fact is not as presumed, the purpose of the presumption is over.
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 circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed. (...) To disprove the presumptions, the Accused should bring on record such facts and circumstances, upon consideration of which, the Court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist. 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. The Accused has also an option to prove the non-existence of consideration and debt or liability either by letting in evidence or in some clear and 11 2009 (2) SCC 513 Page 12 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 13 of 30 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 evidence 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 presumptions under Sections 118 and 139 of the Act will not again come to the Complainant's rescue. (emphasis supplied)"
12.4.The first inkling of the defence is brought about in the reply to the notice of accusation as well as the statement u/s 313 r/w s.281 Cr.P.C., whereby it has been stated that the cheque in question had been issued as blank signed as security against the previous loan of ₹ 30 lakh taken from the Complainant between the 2009 to the year 2012. Further, it has been stated that seven such cheques were earlier issued in blank with signature only as security towards the said transaction, which stood duly discharged by the Accused but the cheques were not returned to the Accused despite demand. The terms of the aforesaid loan and the interest stipulation at 1% per month (i.e., 12% per annum) have been clarified in the statement of the Accused u/s 313 r/w s.281 Cr.P.C. & it is also the defence of the Accused that the aforenoted previous loan had been repaid in the year 2017 along with a total interest amount of ₹ 16,81,000. The Accused has categorically denied his liability under the cheque in question, on the aforenoted grounds.
12.5. The Ld. Counsel for the Accused has stated that the cheque in Page 13 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 14 of 30 question has evidently been issued blank signed and the signature vis-à-vis the date, amount and payee name are filled up in different handwriting and in different shade of ink. Reliance has been placed on the judgements of the Hon'ble High Court of Karnataka in H. Manjunath Vs. A.M. Basavaraju12 to contend that the Accused is not liable under the cheques in question.
12.6. The law regarding issuance and delivery of blank signed cheques is well settled. In the case of Bir Singh Vs. Mukesh Kumar13, the Hon'ble Supreme Court observed and held:
"37. A meaningful reading of the provisions of the Negotiable Instruments Act including, in particular, Sections 20, 87 and 139, makes it amply clear that a person who signs a cheque and makes it over to the payee remains liable unless he adduces evidence to rebut the presumption that the cheque had been issued for payment of a debt or in discharge of a liability. It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted."
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the Accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence."
12Crl.A. 952/2009 (KarHC) 13 2019 (4) SCC 197 Page 14 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 15 of 30 12.7.Hence, the aforesaid contention is found to be without merit.
12.8.In support of the next limb of his defence, the Accused has cross examined CW - 1 wherein he has been able to elicit certain very important points in the course of the cross examination. At the outset, CW - 1 admits that he had advanced a total loan amount of ₹ 30 lakh in the year 2009 till 2012 in the name of the Accused and his proprietorship, Nirmala Jewellers. CW - 1 also admits that out of the said loan of ₹ 30 lakh, some of the amount was given by his wife, since they both had a joint account. He also goes on to admit that the Accused had repaid that the loan in instalment starting from the year 2013 and ending in the year 2017. Further, CW - 1 states that the said amount of ₹ 30 lakhs was extended to the Accused, by way of cheque and was also repaid by the Accused, by way of cheque.
12.9.Now, CW - 1 goes on to depose that a fresh loan of ₹ 15 lakh, which forms the underlying debt and the subject matter of the cheque in question in the instant case, had been advanced in the year 2016. He admits that there was no written agreement executed between the Complainant and the Accused in respect of the said loan. It would not be out of place to mention herein that this alleged loan of ₹ 15 lakh (in the alleged discharge of which one cheque amounting to ₹ 5 lakh forms the subject matter of the present complaint) was advanced by way of cash as per the averments in the complaint and the evidence affidavit of CW - 1.
Page 15 of 30Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 16 of 30 12.10.The rest of the cross examination of CW - 1 proceeds only in respect of date of issuance of the cheques in question and is largely made up only of suggestions given from the side of the defence, which CW - 1 denies.
12.11.In support of his defence, the Accused has summoned his bank account statements pertaining to his accounts by the name of Narayan Chandra Giri, Narayan Chandra Giri (HUF) and M/s Nirmala Jewellers whereby DW - 1 Sh. Vinod Pathak, Single Window Operator, United Bank of India, Karol Bagh Branch has brought the summoned the record for the period 2nd of January 2009
- 27th of December 2016, 10th of November 2009 - 30th of December 2016 and 10th of February 2009 - 31st of December 2016 respectively. The said statements are present on record as Ex. DW1/A (Colly).
12.12.The Ld. Counsel for the Complainant has, at the time of final arguments, taken the objection that Ex. DW1/A (Colly). is not accompanied with a certificate in compliance with s.2(8) of the Bankers Book Evidence Act, 1891. To decide this objection, it must first be decided as to whether the said objection is to admissibility or as to mode of proof. s. 2(8) of the Bankers Book Evidence Act, 1891 prescribes as to what constitutes a "certified copy". s. 4 of that Act reads as under
"4. Mode of proof of entries in bankers' books.-- Subject to the provisions of this Act, a certified copy of any entry in a banker's book shall in all legal Page 16 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 17 of 30 proceedings be received as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions and accounts therein recorded in every case where, and to the same extent as, the original entry itself is now by law admissible, but not further or otherwise."
12.13. A bare perusal of s.4 would reveal that the certification required u/s 2(8) is qua the mode of proof and does not affect the inherent admissibility of the record as evidence. In this aspect, the judgement in R.V.E. Venkatachala Gounder vs. Arulmigu Viswesaraswami 14 assumes importance wherein it was held:
"Ordinarily an objection to the admissibility of evidence should be taken when it is tendered and not subsequently. The objections as to admissibility of documents in evidence may be classified into two classes:-
(i) an objection that the document which is sought to be proved is itself inadmissible in evidence; and
(ii) where the objection does not dispute the admissibility of the document in evidence but is directed towards the mode of proof alleging the same to be irregular or insufficient.
In the first case, merely because a document has been marked as 'an exhibit', an objection as to its admissibility is not excluded and is available to be raised even at a later stage or even in appeal or revision. In the latter case, the objection should be taken before the evidence is tendered and once the document has been admitted in evidence and marked as an exhibit, the objection that it should not have been admitted in evidence or that the mode adopted for proving the 14 Appeal (civil) 10585 of 1996 (SC) Page 17 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 18 of 30 document is irregular cannot be allowed to be raised at any stage subsequent to the marking of the document as an exhibit....The omission to object becomes fatal because by his failure the party entitled to object allows the party tendering the evidence to act on an assumption that the opposite party is not serious about the mode of proof. On the other hand, a prompt objection does not prejudice....Out of the two types of objections, referred to hereinabove, in the latter case, failure to raise a prompt and timely objection amounts to waiver of the necessity for insisting on formal proof of a document, the document itself which is sought to be proved being admissible in evidence...."
12.14.Hence, the said objection of the Complainant is only qua the mode of proof and having not been taken at appropriate stage, the same stands waived, and it cannot be taken at this stage.
12.15.Next, the Accused has summoned the record of a criminal complaint u/s 420/467/468/471/406/120B/34 IPC filed by him against the Complainant herein and his wife Smt. Archana Mukherjee, whereby DW - 2, Sh. Bhushan Kumar, Ahlmad in the concerned Court has brought the summoned record of the complete original paper book of the complaint and the certified copies of the complaint placed on record have been exhibited as Ex. DW2/A (OSR) (Colly).
12.16.When Ex. DW1/A is read along with Ex. DW2/A, the defence of the Accused is unravelled. Ex. DW2/A contains, the ledger account for the period 1st of April 2012 to 31st of March 2017 qua the dealings between the Accused (Narayan Chandra Giri (HUF)) and the Complainant (internal Pages 98-102 of Ex. DW2/A). Similarly, a ledger account for the period 1st of April 2011 to 31st of March Page 18 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 19 of 30 2017 qua the dealings between the proprietorship of the Accused (Nirmala Jewellers) and the Complainant jointly with his wife, Archana Mukherjee (internal Pages 104-113 of Ex. DW2/A). In both of these ledger account statements, the amount received from the Complainant, along with cheque number and also the interest amount paid by the Accused, along with its cheque number have been meticulously recorded.
12.17.In addition to the aforesaid, the Accused has duly deducted TDS on interest payments, which would be adverted to in the subsequent paragraphs. On a close scrutiny of these ledger accounts of Narayan Chandra Giri (HUF) and Nirmala Jewellers, it is apparent that a total amount of ₹ 31,10,000 (Thirty-One Lakh and Ten Thousand Rupees) was received from the Complainant in the financial years beginning in 2011 and ending in 2016-2017 and the said amount had been duly repaid by the Accused by 31.12.2016 (i.e, well before the end of the financial year 2016-17) as per the ledger account.
12.18.The law regarding fastening of liability or the discharge thereof on the basis of statement of account/ledger is incorporated in s.34 of the Indian Evidence Act, 1872 whereby:
s.34.- Entries in books of account including those maintained in an electronic form when relevant Entries in books of accounts including those maintained in an electronic form, regularly kept in the course of business, are relevant whenever they refer to a matter into which the Court has to inquire, but such statements shall not alone be sufficient evidence to charge any person with liability.(emphasis supplied) Page 19 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 20 of 30 12.19.Thus, it is clear that the ledger account/books of account, though relevant, but cannot ipso facto be used for the purposes of charging any person with liability without corroboration.
12.20.A necessary corollary to the above principle has been enunciated by the Hon'ble Delhi High Court whereby the ledger account/books of account cannot ipso facto be used by the Accused herein in support of his plea of discharge of liability unless the same is corroborated by other independent evidence 15. The corroboration of the said ledger account is received when the same is juxtaposed with the bank account statements of the Accused, i.e. A/c No. 0535050007864 in the name of Nirmala Jewellers and A/c No. 0535010052558 in the name of Narayan Chandra Giri (HUF), both forming part of Ex. DW-1/A(Colly). The ledger account and the payments received from the Complainant and the interest as well as principal amount repaid to the Complainant by the Accused are so meticulously recorded and coincide with the bank account statement of the Accused in such a manner that they are fully corroborated. As the said record is quite voluminous in nature and consisting of multiple entries, for the sake of brevity, it would be fruitful to examine a couple of the entries to show the mode and manner in which they corroborate each other. The same is presented in a tabulated form in the succeeding page.
As held by the Hon'ble Delhi High Court in M/s Bansidhar Ganga Pershad Agency Vs. 15 Chanan Lal & Anr. 1974 SCCOnline Del 191 Page 20 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 21 of 30 S.No. Entry in the Ledger Entry in the bank account Observations Account of Narayan statement Narayan Chandra Giri (HUF) Chandra Giri (HUF) along along with date with date
1. 09.05.2012- Credit of 11.05.2012- Credit of ₹ 5 lakh The said entries ₹ 5 lakh by way of by way of cheque number corroborate each cheque number 041991 (By INST CTS OW other save and 041991 (Pg. 98 of Ex. CLG 41991) (Pg. 7 of except the date for DW2/1) relevant account statement presentation, which contained in Ex. DW2/1) would depend on the payee
2. 09.05.2012 - Debit of 11.05.2012 - Debit of ₹ 5000 The said entries ₹ 5000 as interest by way of cheque number corroborate each payment way of 000705 to B. Mukherjee (Pg. other save and cheque number 7 of relevant account except the date for 000705 (Pg. 98 of Ex. statement contained in Ex. presentation, which DW2/1) DW2/1) would depend on the payee
3. 05.06.2012 - Debit of 12.06.2012 - Debit of ₹ 5000 The said entries ₹ 5000 as interest by way of cheque number corroborate each payment way of 000706 to Biman Mukherjee other save and cheque number (Pg. 7 of relevant account except the date for 000706 (Pg. 98 of Ex. statement contained in Ex. presentation, which DW2/1) DW2/1) would depend on the payee S.No. Entry in the Ledger Entry in the bank account Observations Account of Nirmala statement Nirmala Jewellers Jewellers along with along with date date
1. 09.05.2012- Credit of 11.05.2012- Credit of ₹ 3 lakh The said entries ₹ 3 lakh by way of by way of cheque number corroborate each cheque number 041989 (By INST CTS OW other save and 041989 (Pg. 105 of Ex. CLG 41989) (Pg. 29 of except the date for DW2/1) relevant account statement presentation, which contained in Ex. DW2/1) would depend on the payee
2. 05.05.2012 and 08.05.2012 & 11.05.2012- The said entries 09.05.2012 Debit of ₹ Debit of ₹ 15,000 & ₹ 3,000 corroborate each 18,000 as interest by cheque number 487428 & other save and payment by cheque 487460 to B. Mukherjee (Pg. except the date for numbers 487428 & 29 of relevant account presentation, which 487460 (Pg.105 of Ex. statement contained in Ex. would depend on DW2/1) DW2/1) the payee Page 21 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 22 of 30 12.21.Going by the ledger account contained in Ex. DW2/A and the bank account statement of the Accused contained in Ex. DW1/A, it is quite apparent that the Accused was, till 30th of December 2016, repaying the principal amount as well as the monthly interest of the previous loan transaction of ₹ 30 lakh which has been admitted by the parties. The advance of that loan, the payment of interest and the principal has been well-documented by the Accused in the ledger account as well as the account statement. The said payments even reflect the interest rate of 12% per annum (or 1% per month) as has been claimed by the Accused. It is also quite pertinent to note that the Accused had also been deducting TDS and depositing the same with the income tax department in respect of the monthly interest payments being made to the Complainant and the said TDS receipts/acknowledgements are present in Ex. DW2/A (internal page 18 to 67).
12.22.In this backdrop, it is hard to fathom that when the Accused is in the process of repayment of a previous loan of such high amount as ₹ 30 lakh, which has been admittedly advanced by the Complainant by way of cheque and which was also being repaid by the Accused by way of cheque over a period of almost 5 years (from 2012 to 2016), the Complainant would subsequently agree, during the currency of the previous loan, to advance a fresh loan of a high amount of ₹ 15 lakh and that too in cash without any written agreement/receipt.
12.23.The previous conduct of the parties in respect of the loan transaction Page 22 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 23 of 30 of ₹ 30 lakh is quite relevant when deciding whether or not the defence has been able to probabilise its plea that no fresh loan was advanced in 2016. This is so because the alleged subsequent loan of ₹ 15 lakh was advanced during the continuance of the previous loan transaction and as such the alleged subsequent loan transaction and its circumstances have a close nexus with the previous one and its circumstances as to form a part of the same transaction, which would make both such facts relevant as res gestae16.
12.24.The advancement of the previous loan by way of cheque, its interest payments being done by the Accused on a monthly basis by way of cheque, the deduction of TDS by the Accused on interest payment and the principal amount as well as the interest of that loan being cleared by the Accused by 31st of December 2016 are all relevant for the reason that they establish a particular course of business/dealings between the parties 17 which has been admittedly continuing for a considerable amount of time (since 2012 to 2016) and has been well documented. The grant of the alleged second loan of ₹ 15 lakh during the subsistence of the previous loan and that too by way of cash and without any documentation would certainly raise eyebrows, as they are a significant deviation from the ordinary course of dealings between the parties.
12.25.This is especially true as the Complainant himself, in Para 4 of the legal demand notice Ex. CW1/4, admits that the said loan was 16 u/s 6 of the Indian Evidence Act 17 Relevant u/s 16 of the Indian Evidence Act Page 23 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 24 of 30 advanced "for the first time off the record and out of good faith". When the Complainant himself was deviating from established practice with the Accused and going off the record, the peculiar circumstances surrounding the advance of the second loan are clearly suspicious and unexplained and are at variance to the standard of a reasonable man.
12.26. Further, the complaint itself is quite vague in nature whereby only the year of advancement, i.e., 2016 is mentioned. Para 4 thereof mentions that there existed some stipulation as to interest but the rate thereof is conspicuously absent. While Para 3 of the Complaint mentions that the Accused requested the Complainant for the loan, Para 3 of the Legal Demand Notice, Ex. CW1/4 mentions that the Accused and his son, Mr. Rajiv Giri had approached the Complainant. Para 14 of the complaint mentions that the Accused in "discharge" (and not part discharge) of his liability, issued the cheque in question. Para 3 of the complaint and Para 3 of Ex. CW1/4 mentions that the said loan was demanded by the Accused for the purposes of expansion of business and to repay the commercial creditors of the Accused, which is contrary to Ex. DW1/A, which reveals that the three accounts of the Accused, collectively had a sum of ₹ 15 lakh is balance at the end of 2016. In these circumstances, it is quite suspicious as to what was the overwhelming need of the Accused to borrow an additional ₹ 15 lakh in cash when he had the said amount available in his bank account.
Page 24 of 30Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 25 of 30 12.27.The Ld. Counsel for the Complainant has contended that the defence of the accused is vague in nature and the Accused has not indicated any cheque number or the account or bank qua the alleged seven security cheques. He also states that going by the defence of the Accused that the blank signed cheque had not been returned by the Complainant, the Accused had not made any effort to stop payment of those cheques or make any complaint before any authority. He also states that the Complaint forming subject matter of Ex. DW2/A has been evidently filed on 29th of March 2019, subsequent to the institution of the present case and neither the Complainant nor his wife have been summoned in the matter till date. He also states that has taken a false defence whereby it was suggested to CW - 1 in his cross examination that the cheque bearing number 696 drawn on United Bank of India was still in his possession whereas perusal of the bank account statement of A/c No. 0535050007864 in the name of Nirmala Jewellers forming subject matter of Ex.DW1/A (internal page 21) would reveal that the cheque bearing number 696 has been encashed by the Accused for the purposes of paying BYPL on 06.07.2013.
12.28.On an examination of the aforesaid contentions, the same are found to be without merit. Going by the defence of the Accused that the cheque in question were issued as blank as security and were not intended to be encashed, the conduct of the Accused in preferring a separate criminal complaint before the Magisterial Court forming subject matter of Ex. DW2/A cannot be faulted. It fulfils the Page 25 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 26 of 30 standard of sufficient exercise of diligence that the Accused has been so vigilant as to file a complaint soon after coming to know that his cheques have been presented for encashment. Further, the conduct of the Accused in promptly taking the defence at the first instance in the notice of accusation goes in his favour and the mere fact that it does not mention the cheque numbers would not detract from the same, as the Accused has been able to substantiate his plea in the course of the trial. So far as the issue of the cheque number 696 is concerned, Ex. DW1/A does not say that the said cheque was drawn on United Bank of India. Moreover, the cheque number 696 is not the subject matter of the instant complaint, and the said objection is not tenable for the aforesaid reasons.
12.29.It must be kept in mind that the case of the Complainant must stand on its own legs. Though the case of the Complainant is initially aided by presumptions in his favour, the burden of satisfying all the legal ingredients of the offence beyond reasonable doubt rests upon the Complainant and never shifts. The Complainant cannot rely upon the inconsistencies in the defence in support of its own case.
12.30.In the ultimate analysis, the Accused has sufficiently probabilized defence, has satisfied the standard of preponderance of probabilities and has shown that the case of the complainant is highly improbable and at variance to the standard of a reasonable man. Resultantly, the presumption that the cheque in question were issued in discharge of any legally recoverable debt or other liability of the Accused stands rebutted and the onus shifts back upon the Complainant to prove the Page 26 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 27 of 30 same. Considering the evidence on the record, the Complainant has miserably failed to discharge this onus and this ingredient remains unfulfilled as against the Accused.
(b) That the cheque has been presented to the bank within a period of three months from the date on which it is drawn or within the period of its validity, whichever is earlier;
12.31.This requirement is satisfied on a perusal of the cheque in question Ex. CW1/1 which bears date of 12.11.2018 and the return memo Ex. CW1/2 which bears the date of 14.11.2018. The defence has led no evidence to controvert the same and hence, this ingredient stands fulfilled as against the Accused.
(c) That the cheque has been returned by the drawee bank unpaid, for the reason that 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 agreement made with that bank 12.32.s. 146 of the Negotiable Instruments Act, 1881 provides that the Court shall, on production of bank's slip or memo having therein the official mark denoting that the cheque has been dishonored, presume the fact of dishonour of such cheque, unless and until such fact is disproved. The bank return memo Ex. CW1/2 on record states that the cheques in question have been returned dishonoured for the reason "Funds Insufficient". The defence has led no evidence to controvert the same and hence, this ingredient is also fulfilled as against the Accused.
(d) That the payee or holder in due course has made a demand for Page 27 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 28 of 30 payment of the said amount of money by giving a notice in writing to the drawer of the cheque within 30 days of receipt of information from the bank regarding the return of the cheque as unpaid 12.33.As regards the service of legal demand notice, the Complainant has sent the same, Ex. CW1/3 to the Accused. The original postal receipts & track reports in respect of the same are already on record as Ex. CW1/4 to Ex. CW1/6. However, the Accused has denied receiving any legal demand notice in his notice of accusation but has admitted the address appearing on it to be his correct address. Further, in his examination u/s 313 read with s.281 Cr.P.C., the Accused has denied receipt of legal demand notice.
12.34.Perusal of the record reveals that the address mentioned in the legal demand notice is identical to the address informed by the Accused in his examination u/s 313 read with s.281 of the Cr.P.C and the very same address appears on the notice of accusation & bail bonds as well.
12.35.section 27 of the General Clauses Act provides that service of any document sent by post, shall be deemed to be effected by properly addressing, prepaying and posting by registered post, a letter containing the document unless the contrary is proved. A like presumption is also carved out under section 114 Indian Evidence Act, 1872 which when applied to communications sent by post, enables the court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. A bare denial by the Accused in his Page 28 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 29 of 30 notice of accusation and in his examination u/s 313 read with s.281 Cr.P.C. would not assume the character of defence evidence, as held in V.S. Yadav v. Reena 18 . Hence, the Accused has not been able to rebut the presumption of service of legal demand notice. Resultantly, the benefit of the presumption accrues in the favour of the Complainant and this ingredient is fulfilled as against the Accused.
(e) That the drawer of the cheque fails to make the payment of the said amount of money to the payee or holder in due course within 15 days of receipt of the said notice 12.36.In the instant case, the Accused has denied receiving legal demand notice, both in the notice of accusation u/s 251 Cr.P.C. and the statement of the Accused u/s 313 read with s.281 Cr.P.C.
12.37.In C.C.Alavi Haji vs Palapetty Muhammad 19, it was held by the Hon'ble Supreme Court:
"Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the Complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of Complaint with the summons) and, therefore, the Complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the Complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of 18 supra 19 (2007) 6 SCC 555 Page 29 of 30 Visit eCourts.gov.in for updates or download mobile app "eCourts Services" from Android or iOS CC No. 700/2019 CNR. DLCT020302852018 Biman Mukherjee V/s Narayan Giri Page 30 of 30 notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act."
12.38.Hence, regardless of the said averment in respect of non-receipt of legal notice, it was open to the Accused to make the payment due under the cheque within 15 days of service of summons of the instant case. However, the Accused has failed so to do, on the ground that he does not owe any liability towards the Complainant, a defence which he has been able to prove at the trial. Hence, this ingredient stands fulfilled as against the Accused.
Decision
13. As all the ingredients of the offence are not cumulatively satisfied against the Accused, the Accused Narayan Giri is hereby Acquitted of the offence u/s 138 of the Negotiable Instruments Act, 1881.
VISVESH Digitally signed by VISVESH
Date: 2021.12.20 14:46:26 +05'30'
ANNOUNCED IN THE OPEN (VISVESH)
COURT ON 20.12.2021 MM, NI ACT-06, CENTRAL
TIS HAZARI COURTS,
DELHI
Page 30 of 30
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