Delhi District Court
Hdfc Bank Ltd vs Sukhdev Kumar Ojha on 16 October, 2012
IN THE COURT OF SH. AKASH JAIN, METROPOLITAN
MAGISTRATE (NI ACT)01, DWARKA COURTS, NEW DELHI.
CC NO 1465/12
Unique case ID no. : 02405R0768742009
HDFC Bank Ltd.
Having its office at :
Ansal Classique Tower,
9th Floor, J Block, Community Center,
Rajouri Garden,
New Delhi110027. ......................... Complainant
VERSUS
Sukhdev Kumar Ojha
H.No.6, BlockK2,
Gali No.1, Band Road,
Sangam Vihar, New Delhi110062.
Also at:
Bachan Prasad, Govt. Sarvodaya Girls Sr. Sec. School,
Deoli, New Delhi62. ................................ Accused
P.S.: Rajouri Garden
U/S:138 NI Act
a) Date of institution : 26.08.2009
b) Date of reserving the judgment : 10.10.2012
c) Date of pronouncement of judgment : 16.10.2012
d) Offence complained of : Section 138 of Negotiable
Instruments Act.
e) Plea of accused : Pleaded not guilty and claimed
trial.
f) Final Judgment : Acquitted
CC NO. 1465/12 Page no. 1 of 18
: JUDGMENT :
1.Vide this judgment, I shall dispose of the present complaint filed by the complainant, HDFC Bank Ltd. under Section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as the 'NI Act') against the accused Sukhdev Kumar Ojha.
2. Factual matrix of the case as per complainant is that the complainant is a Banking company within the meaning of Banking Regulation Act 1949 , having its registered office at Senapati Bapat Marg, Lower Parel, Mumbai and one of its concern offices at Ansal Classique Tower, 9th Floor, J Block, Community Center, Rajouri Garden, New Delhi110027. It is averred that the complainant is engaged, interalia, in the business of Banking. It is further averred that Centurion Bank of Punjab Ltd. had amalgamated with HDFC Bank Ltd. pursuant to order dated 20.05.2008 of Reserve Bank of India w.e.f. 23.05.2008. It is stated that the accused approached the erstwhile Centurion Bank of Punjab Ltd. for obtaining CBL personal loan and on request made by the accused, the complainant sanctioned the same in favour of the accused in terms of loan agreement no. 91609344. It is further stated that the accused had promised to make timely & regular payment of scheduled EMIs to the complainant without any default, but the accused failed to abide by the terms & conditions of the loan agreement in question and committed defaults in payment of EMIs.
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3. It is stated that the accused in discharge of his legal liability issued a cheque bearing no.620551 dated 01.05.2009 for a sum of Rs.30,163/ drawn on ICICI Bank Ltd., Nehru Place against the payment of dues accumulated on account of non payment of the monthly installments under the agreement in favour of the erstwhile Centurion Bank of Punjab Ltd.. However, the said cheque when presented for encashment by the complainant was dishonoured by the bankers of accused for the reason "Insufficient Funds" vide returning memo dated 18.06.2009. Thereafter, the complainant company sent a legal notice dated 13.07.2009 through speed post & UPC to the accused intimating him about the dishonour of cheque in question and calling upon him to pay the amount covered by the cheque within 15 days of receipt of the said notice. The accused though failed to make any payment within stipulated period of time. Hence, the present complaint.
4. Perusal of the record shows that the present complaint was received by way of assignment by this court on 26.08.2009. On the basis of pre summoning evidence led by the complainant on 22.09.2009, Ld. Predecessor Court issued summons against the accused under Section 138 of NI Act. Upon service of the summons, the accused entered his appearance before the court on 04.01.2010 and was admitted to bail. Thereafter, on 19.02.2010, notice under Section 251 Cr.P.C. was served upon the accused by Ld. Predecessor Court, to which accused pleaded not CC NO. 1465/12 Page no. 3 of 18 guilty and claimed trial. The matter was then fixed for complainant's evidence.
5. The complainant in support of its case examined Sh. Daulat Singh, AR of the complainant as CW1 who while reiterating the contents of complaint placed reliance upon following documents as under : Ex. CW1/A : Power of Attorney in favour of substituted AR Ex. CW1/2 : Cheque in question Ex. CW1/3 : Returning memo in question Ex. CW1/4 : Legal demand notice dated 13.07.2009 Ex. CW1/5 to CW1/6 : Postal Receipts
6. CW1 was duly crossexamined by the counsel for accused. During crossexamination, CW1 stated that loan transaction in question was not carried out in his presence and that he does not know the date, month & year as to when accused approached the complainant for obtaining loan. CW1 stated that a sum of Rs.2,49,900/ was disbursed to the accused on 30.06.2007 and that the same was disbursed by Centurion Bank who had already merged into HDFC bank on 20.05.2008 w.e.f. 23.05.2008. CW1 admitted that no document evincing merger of complainant bank with Centurion Bank is filed on record. CW1 further admitted that the power of attorney dated 31.03.2010 as referred at point A in Ex. CW1/A is not filed on record. CW1 stated that he does not remember the exact amount payable CC NO. 1465/12 Page no. 4 of 18 by the accused to complainant on 13.07.2009 i.e. the date of dispatch of legal notice. However, he voluntarily said that an approximate sum of Rs. 30,600/ was due upon the accused as on 01.05.2009. CW1 also stated that he does not know the date, month and year as to when the cheque in question was issued by the accused to complainant. CW1 denied the suggestion that the cheque in question was a security cheque given to the Centurion Bank which it did not return. CW1 further denied the suggestion that Ex. CW1/3 is a forged and manipulated document as the same had been generated from the complainant bank. CW1 admitted that the loan agreement in question and statement of account of accused is not filed on record by complainant.
7. Thereafter, complainant's evidence was closed. Statement of accused under Section 313 Cr.P.C. was consequently recorded wherein all the incriminating circumstances were put to the accused. The accused admitted to have issued the cheque Ex. CW1/2 in favour of Centurion Bank and admitted his signatures on the same. However, he stated that the said cheque was handed over by him to Centurion Bank as blank without filling any particulars as security at the time of disbursement of loan. The accused denied the service of legal demand notice dated 13.07.2009 upon him. The accused further stated that he did not wish to lead any defence evidence. Thereafter, defence evidence got closed and the matter was fixed for final CC NO. 1465/12 Page no. 5 of 18 arguments. Both the parties addressed final arguments through their counsels.
8. Ld. Counsel for the complainant argued that each and every ingredient of offence under Section 138 NI Act is proved by them beyond reasonable doubt. It is argued that the accused in his statement recorded under Section 313 Cr.P.C. had admitted the factum of taking loan from the Centurion Bank and admitted his signatures on the cheque in question. It is further argued that the accused failed to lead any defence evidence on his behalf and has failed to rebut the presumptions as contemplated by Section 118 (b) & 139 NI Act. As such, the accused is liable to be convicted under Section 138 of NI Act.
9. The counsel for accused on the other hand argued that the cheque in question was given by the accused to Centurion Bank of Punjab Ltd. in blank signed form for security purposes at the time of disbursement of loan. It is argued that on the date mentioned on cheque in question, the liability of the accused was not to the extent of amount mentioned in the cheque. It is also argued that loan agreement in question and the statement of account of accused had not been filed by the complainant on record despite specific queries raised on behalf of the accused. It is contended that the complainant had failed to file on record any authentic documents to show the debt/ CC NO. 1465/12 Page no. 6 of 18 liability upon the accused towards the complainant. It is further contended that accused obtained loan from Centurion Bank of Punjab Ltd. and the complainant HDFC bank had failed to bring any documents to show that Centurion Bank of Punjab Ltd. has amalgamated with HDFC Bank. It is also argued that returning memo in question is a forged and manipulated document as the same does not bear any signature, stamp and seal of bank officials concerned.
10. This court has considered final arguments advanced on behalf of both the parties and carefully perused the record. In order to fasten criminal liability upon the accused under Section 138 of NI Act complainant is incumbent to prove the following :
(a) The accused issued a cheque on an account maintained by him with a bank.
(b) The said cheque has been issued in discharge, in whole or in part, of any legal debt or other liability.
(c) The said cheque has been presented to the bank within a period of six months from the date of the cheque or within the period of its validity.
(d) The aforesaid cheque when presented for encashment, was returned unpaid/ dishonoured.
(e) The Payee of the cheque issued a legal notice of demand within 30 days from the receipt of information by him from the Bank regarding the return CC NO. 1465/12 Page no. 7 of 18 of the cheque.
(f) The Drawer of the cheque failed to make the payment within 15 days of the receipt of aforesaid legal notice of demand.
11. The drawing of cheque in question by the accused is not disputed by him. However, he has raised following defences to controvert the claims of complainant :
i) That the complainant HDFC bank has failed to prove that Centurion Bank of Punjab Ltd. has amalgamated with HDFC Bank and that the complainant bank is authorized to initiate present criminal proceedings against the accused.
ii) That the cheque in question was given by the accused to the Centurion Bank for security purposes at the time of disbursement of loan and the same was not issued in discharge of any legal debt or liability towards the complainant.
iii) That the returning memo in question is not properly proved by the complainant and the same is a forged and manipulated document.
12. With respect to the first defence raised by the accused, it is the admitted fact that the loan in question was obtained by the accused from Centurion Bank of Punjab Ltd. It is averred by the complainant in its complaint that the said bank was amalgamated with HDFC bank pursuant to CC NO. 1465/12 Page no. 8 of 18 order dated 20.05.2008 of Reserve Bank of India w.e.f. 23.05.2008. It is though pertinent to note that the said order of amalgamation has never been placed on record by the complainant. During crossexamination of CW1, he admitted that the document evincing merger of complainant bank with Centurion Bank of Punjab Ltd. is not filed on record. Even after suggestion put by the counsel for accused that no such merger has taken place, the complainant did not care to bring the same on record through proper means. At the time of final arguments, it was argued by the counsel for complainant that the document i.e. order dated 20.05.2008 passed by RBI is a document which is judicially noticeable under Section 57 of Indian Evidence Act. As such the same need not be filed on record and need not be proved as per Section 56 of Indian Evidence Act. Counsel for complainant though failed to show as to how the notification/ order dated 20.05.2008 passed by RBI is judicially noticeable under Section 57 of Evidence Act as the same does not fall under any category enumerated therein. The complainant has thus failed to prove the factum of amalgamation of Centurion Bank of Punjab Ltd. with HDFC Bank. The defence raised by the accused that the complainant in the present case i.e. HDFC Bank is not a holder in due course of cheque in question under Section 9 of Negotiable Instruments Act is therefore sustained.
13. Coming to the second defence raised by the accused in the present CC NO. 1465/12 Page no. 9 of 18 case, it would be apposite to refer to the provisions of section 118 and 139 of NI Act. Section 118 (a) provides that, unless the contrary is proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under section 139 of NI Act, the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part of a debt or liability. Thus, in complaints under Section 138 the court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable. However, the burden of proving that a cheque had not been issued for a debt or liability is on the accused.
14. It is pertinent here to note the case of Hiten P. Dalal Vs. Bratindranath Banerjee, 2001 Crl. L.J 4647 wherein Hon'ble Supreme Court while dealing with sections 138 and 139 of NI Act held that whenever a cheque was issued to the complainant for a specific amount, there is a presumption that it is towards discharge of legally enforceable debt. In the event of dispute, the burden is on the accused to prove that there is no subsisting liability as on the date of issuing of cheque and the proof must be sufficient to rebut the presumption and mere explanation is not sufficient. So, there is obligation on the part of the Court to raise the presumptions under Sections 118 and 139 of the NI Act in every case where the factual basis for raising of the presumption had been established.
CC NO. 1465/12 Page no. 10 of 18
15. However, it is not out of place here to refer to the ratio of judgments in M.S. Narayana Menon v. State of Kerala, AIR 2006 SC 3366 and Krishna Janardhan Bhat v. Dattatraya G. Hegde, 2008 AIR (SC) 1325, on the point that it is not necessary that the rebuttal is always essentially by leading separate contrary evidence and it would suffice if the accused can demonstrate from the crossexamination of the complainant that the burden to prove contrary is discharged. So far as, presumption as to issuance of cheque for consideration and in discharge of debt, the accused need not disprove the complainant case in its entirety. He can discharge his burden on the preponderance of probabilities though direct or circumstantial evidence for which he can rely on evidence adduced by the complainant.
16. Mere admission of the signatures on cheque in question by the accused is not sufficient to fasten criminal liability upon him. The onus to prove outstanding liability upon the accused on the date of issuance of cheque lies upon the complainant. The complainant though failed to place on record any loan agreement in question or statement of account to show the outstanding liability due upon the accused on the date of alleged issuance of cheque despite umpteen opportunities given by the court. Without statement of account of accused, it cannot be ascertained as to whether the accused was liable to pay the amount as mentioned in the cheque to the complainant on the alleged date of its issuance. Also, the CC NO. 1465/12 Page no. 11 of 18 cheque in question was admittedly issued by accused in favour of Centurion Bank of Punjab Ltd. and not the complainant bank. Now, Centurion Bank of Punjab Ltd. is allegedly amalgamated with HDFC w.e.f. 23.05.2008. However, the cheque in question is reportedly drawn by the accused on 01.05.2009. It is highly improbable for the accused to issue a cheque on account of accumulated dues in the name of Centurion Bank of Punjab Ltd. much after the date of its amalgamation with HDFC Bank.
17. All these circumstances raise serious doubts on the veracity of the claim of the complainant thereby probablising the stand of the accused that the cheque in question was not issued in the manner as has been alleged by the complainant and in fact the same might have been issued for security purposes which is later on filled up by complainant. The law in relation to cheques issued for security purposes is discussed in judgments hereinbelow:
18. In M.S Narayanan Menon Vs. State of Kerala and Others. 2006 SCC 39 , it has been held by Apex Court that :
"..........If the defence is accepted as probable the cheque therefore cannot be held to have been issued in discharge of the debt as for example, if a cheque is issued for security or for any other purpose the same would not come within the purview of section 138 of N.I Act...."
CC NO. 1465/12 Page no. 12 of 18
19. In Shanku Concretes Pvt. Ltd. Vs. State of Gujrat 2000 Cri.L.J 1988 (Gujrat) a loan of Rs.15,00,000/ was taken by accused, who issued 7 post dated cheques as collateral security and it was observed by Hon'ble Gujrat High Court that no offence u/s 138 N.I. Act is made out in para 13 and 14 as under :
"...13. The above view further strengthens from the agreement executed between the parties. It is amply clear in the agreement that accused shall repay amount after six months of the execution of agreement and it is also made clear that for due performance of the contract. The intention of the parties is clear from this averments that the cheques were issued as the collateral security for the due performance (vernacular matter omitted.) of the contract, by which the Company and the Director i.e. accused No. 2 bound themselves to repay the said amount. It is, therefore, clear that cheques were not issued to discharge any existing debt.
14. This Court relies on the decision cited by Mr. Majmudar of the High Court of Madras (supra), wherein a principle is laid down that to attract Section 138 of the Negotiable Instruments Act, it must be pointed out that there was subsisting liability or debt on the date when the contract was entered into. In that given case before the High Court of Madras, the contract expressly made it clear that the cheques were handed over as security. In this case, it is clear from the agreement entered into between the parties that CC NO. 1465/12 Page no. 13 of 18 after borrowing the money, making a statement to repay the same at some future date, the cheques were issued for due performance. Therefore, the transaction from its very nature or from the intention of the parties, as reflected in the agreement executed between the parties, is purely of a civil nature, for which a civil suit has already been filed. The very fact that the payment was agreed to some future date and there was no debt or liability on the date of delivery of the cheques, will take the case out of the purview of the Section 138 of the Negotiable Instruments Act...."
20. In Sam Daniel Vs. John 2005 Comp Case 17 (Madras High Court) it was observed by Hon'ble Madras High Court in para 9 and 10 that dishonour of cheque given as collateral security does not make out an offence u/s 138 N.I. Act :
"...9. Strict liability under Section 138 can be enforced only when the cheque is issued in discharge of any legally enforceable debt or other liability, partly or wholly. Where a cheque is issued not for the purpose of discharge of any debt or other liability, return of such cheque unpaid will not meet with the penal consequences and the maker of the cheque shall not, therefore, be liable for prosecution.
10. The Explanation to Section 138 provides that a debt or liability under this section means only a legally enforceable debt or other liability. In common parlance, a debt is something owed to another, a CC NO. 1465/12 Page no. 14 of 18 liability, an obligation, a chose in action, which is capable of being assigned by creditor to some other person. A debt due means that a particular liability is in existence. Thus in cases for an offence of dishonour of cheque, it would be relevant to examine the materials/evidence as to whether there is a "debt payable" and whether the cheque was drawn for that dischargeable debt. While there may be a debt payable in existence, that alone is not sufficient to prove that the cheque was drawn in discharge of that amount. Where the accused raised the point that the cheque in question was not intended to be in appropriation of the debt or to be used for a discharge of the debt, but was issued only as a collateral safeguard, there cannot be presumption under Section 138 of the Negotiable Instruments Act..."
21. In the present case, the accused on preponderance of probabilities has managed to show that the cheque in question was given by him to Centurion Bank as security at the time of disbursement of loan. As such, the accused has successfully rebutted the presumptions of Section 139 and section 118 NI Act and proved his defence that the cheque in question was not given by him in discharge of any legal debt or liability.
22. Coming to the third defence raised by the accused, it is pertinent to peruse the returning memo in question Ex. CW1/2 which carries printed CC NO. 1465/12 Page no. 15 of 18 logo of HDFC bank. Here it is relevant to make reference of Section 146 of NI Act which reads as follows :
"Bank's slip prima facie evidence of certain facts : The court shall, in respect of every proceedings under this Chapter, on production of bank's slip or memo having thereon the official mark denoting that the cheque has been dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved."
23. The presumption under section 146 of NI Act, therefore, arises only when the bank's slip or memo has an official mark of the bank denoting that the cheque has been dishonoured. In the present case, Ex. CW1/3 does not bear any official mark of either accused bank i.e. ICICI Bank or the drawee bank. There is no stamp/ seal/ signature of the bank officials concerned to show that the same had been issued by the said bank. Thus, presumption under section 146 of NI Act cannot be raised in favour of the complainant.
24. AR of the complainant failed to explain as to why original returning memo from ICICI Bank was not placed on record. In the absence of signature/ seal/ stamp of HDFC bank officials on the memo, it was incumbent upon the complainant to examine witness from the bank to prove that the cheque in question was indeed dishonoured on presentation due to the reasons stated in the returning memo. But, the complainant failed to do CC NO. 1465/12 Page no. 16 of 18 the same despite remedies available to them in terms of provisions of Cr.P.C. At this stage, it was contended by counsel for complainant that returning memo in question is a computer generated document which is issued in such state only by the bank and the same was accordingly filed on record. However, the said argument of the complainant does not inspire much confidence. The statute clearly provides for proving such electronic documents via certificate under Section 65 (B) of Indian Evidence Act, but the complainant did not resort to aforementioned means and also did not care to examine bank witness for proving the returning memo in question. Hence, Ex. CW1/3 cannot be read in evidence.
25. Here it is pertinent to refer to the case of Rajendra Kumar vs. State of Gujrat, 2012 (1) Crimes 500, where Hon'ble High Court of Gujrat upheld an order of acquittal of the accused interalia on the ground that the debit memo and cheque returning memo brought on record by the complainant does not bear stamp of any bank and thus, as per section 146 of NI Act, the said documentary evidence could not be considered.
26. Adverting to the facts of the present case, complainant failed to prove on record that cheque in question was dishonoured/ returned unpaid on presentation. In these circumstances, complainant cannot take aid of presumptions contained in Section 118, Section 139 or Section 146 of NI CC NO. 1465/12 Page no. 17 of 18 Act to fasten criminal liability upon the accused.
Final Order:
To hold a person guilty of committing a criminal offence under Section 138 of NI Act, all the ingredients of the said offence should be proved against the accused. But, in the present case two of the main ingredients i.e. the cheque when presented for encashment was returned unpaid/ dishonoured and that the cheque in question was issued in discharge of legal debt or liability of the accused are not proved against the accused. Therefore, there is no need to delve upon the question as to whether complainant has proved remaining ingredients of offence under Section 138 NI Act against the accused.
In view of the aforesaid discussion, this court is of the considered opinion that the complainant has failed to prove its case against the accused. All the ingredients of Section 138 of Negotiable Instruments Act have not been duly proved on record. Accordingly, the complaint stands dismissed and accused Sukhdev Kumar Ojha is acquitted of the offence under Section 138 of Negotiable Instruments Act.
B/B and S/B stands discharged.
Announced in the open (AKASH JAIN) Court on 16.10.2012 MM01 (NI Act) Dwarka Courts, New Delhi CC NO. 1465/12 Page no. 18 of 18