Delhi District Court
Complainant vs . on 25 April, 2015
IN THE COURT OF SHRI PUNEET PAHWA
METROPOLITAN MAGISTRATE 01 (N.I. ACT)
PATIALA HOUSE COURTS : NEW DELHI
M/s Bhandari Engineers & Builders Pvt. Ltd.
803, Bhandari House, 91, Nehru Place,
New Delhi110019.
....................... Complainant
Vs.
1.M/s You One MahariaJV, A10, Panchvati, Azadpur, New Delhi110033.
2. Mr. Vinod Goel, Managing Partner, M/s You One MahariaJV, A10, Panchvati, Azadpur, New Delhi110033.
3. M/s You One Engineering & Construction Co. Ltd., 410411, International Trade Tower, Nehru Place, New Delhi110019.
[NOT SUMMONED]
4. M/s Maharia Resurfacing & Construction Pvt. Ltd.
Case No.409/1 Page No. 1 of 30A10, Panchvati Azadpur, New Delhi110033.
[NOT SUMMONED] ...................................Accused Case Number. : 409/1 Date of Institution of Present Case. : 17.07.2003 Offence Complained Of. : U/s 138 NI Act Plea of the Accused. : Not Guilty Arguments Heard On. : 07.04.2015 Final Order. : Convicted.
Date of Judgment. : 25.04.2015
− :: JUDGMENT ::
1. Vide this judgment, I shall dispose of the present complaint filed by the complainant u/s 138 Negotiable Instruments Act, 1881 (hereinafter referred to as "N.I Act").
2. It has been alleged in the complaint that the complainant is a company whereas, accused no.1 is a joint venture association, incorporated to execute the contract awarded by the National Case No.409/1 Page No. 2 of 30 Highway Authority of India (hereinafter referred to as "NHAI") of Rs.60,68,53,375/. Since the accused no.1 was not having necessary expertise and infrastructure to execute the said contract, a subcontract was executed between the complainant company and accused no.1 for construction of eight laning of KM 16.500 to KM 29.300 of NH1 in the State of DelhiNS18(DL) ("Culverts, Bridges & Protection Work" Bill No.5 of BOQ Excluding Item with "O" Value as Unit Rate on 27.05.2002) and for carrying on work specified in Bill No.5 of BOQ titled as "Culvert, Bridges & Protective Works" of the above said principal Contract.
3. It has been alleged that accused no.2 is the Managing Partner of accused no.1 and thus responsible for the conduct and day to day affairs of the accused no.1 joint venture. Moreover, the cheque in question has been signed by accused no.2 only.
4. It has further been alleged in the complaint that in pursuant to the execution of various works carried out by the complainant, running bills were raised from time to time and those bills were duly certified by RITES. Against the part payment towards the running bills raised by the complainant, accused no.1 issued one cheque, bearing no.444939, dated 13.06.2003 for Rs.8,63,665/, drawn on UCO Bank, Subzi Mandi, New Delhi. The cheque was Case No.409/1 Page No. 3 of 30 signed by accused no.2, however, when the said cheque was presented for encashment on 14.06.2003, the same was returned back unpaid for the reasons "insufficient funds".
5. It has further been alleged in the complaint that on request of accused no.2 the cheque was again presented for encashment on 18.06.2003 but the same was again returned back unpaid for the reasons "insufficient funds". Thereafter, the complainant issued a legal demand notice dated 24.06.2003, calling upon the accused to make the payment within 15 days of receipt of notice. However, when the accused failed to make the payment even after expiry of 15 days of receipt of the notice, the complainant was constrained to file the present complaint u/s 138 N.I. Act.
6. It is pertinent to mention here that initially the complaint was filed against four accused persons, however, only accused no.1 & 2 were summoned. Notice u/s 251 Cr. P.C was served upon accused no.1 & 2 on 16.09.2008. Thereafter the complainant was asked to lead evidence. After CE, statement of accused u/s 313 Cr. P.C was recorded on 06.07.2011 and the accused was asked to lead DE. After DE, final arguments were heard and the case was fixed for orders for today.
Case No.409/1 Page No. 4 of 307. To prove his case, the AR of complainant Sh. S.P. Soni has filed his evidence by way of affidavit, which is Ex. CW 1/1. In support of his case, the AR of complainant has relied upon the following documentary evidence: Board Resolution dated 09.06.2008 in favour of Sh. S.P. Soni Ex. CW 1/A; Board Resolution dated 15.07.2003 in favour of Sh. Harsh Sagar Goyal, who had initially filed the present complaint Ex. CW 1/1; the complaint Ex. CW 1/2; Certificate of Incorporation of the complainant company Ex. CW 1/3; the cheque in question Ex. CW 1/4; cheque returning memo Ex. CW 1/5; covering letter of the complainant's banker dated 21.06.2003 Ex. CW 1/6; legal demand notice dated 24.06.2003 Ex. CW 1/7 and acknowledgment receipt of legal demand notice Ex. CW 1/8.
8. In his affidavit the AR of complainant has reiterated the averments made in the complaint and fully supported the case of the complainant. Thereafter the AR of complainant was cross examined at length by Ld. Counsel for the accused.
9. During crossexamination, a question was put to CW 1 i.e. the AR of complainant, that whether he was sure that the cheque was signed by accused no.2 only? The witness replied in affirmative. He was asked that did he know that the agreement was subject to approval by NHAI ?. The witness replied "Yes" and Case No.409/1 Page No. 5 of 30 stated that the agreement was to be got approved by the accused himself as per the terms of the agreement. A question was put to the witness by the court that was the agreement exhibited was part of the record? The witness replied in negative. Then again a question was put by the court that then why the cheque was issued? In reply to the said question, the witness replied that they had executed work worth Rs.91,48,771/ and bills were raised for that value on the accused no.1 and against the said bills, accused no.4 had made payment for a sum of Rs.17,83,000/ and in addition to that cheque another cheque was issued for the sum of Rs.8,63,665/, which got dishonoured.
10. CW 1 was questioned by Ld. Counsel for the accused that as to for which work executed by the complainant, the cheque in question was issued and what was the amount of work done by the complainant during the period May, 2002 to May, 2003? The witness stated that the cheque was issued as part payment for work executed from May, 2002 to May 2003 and the work done was of approx. Rs.83,00,000/. He was suggested that the bill Ex. CW 1/D1 did not show any acknowledgement by the accused, to which the witness stated that the bill was delivered in the office of the accused and no acknowledgement was given by the accused.
Case No.409/1 Page No. 6 of 3011. A suggestion was put to the witness that the complainant had executed work for a sum of Rs.1,13,665/ for the month of May, 2003. In answer to this suggestion, the witness stated that they have done work of the value approx. Rs.83,00,000/ upto May, 2003 and, against the work done they have been paid payment of Rs.17,83,000/. He further stated that in addition to this amount, the cheque in question was issued which was dishonoured. A suggestion was put to the witness that on request of Sh. Ajit Bhandari, the Director of the complainant, a sum of Rs.7,50,000/ alongwith the payment of bill for the month of May, 2003 was given as advance, on the condition that the complainant will expedite the work. In answer to this suggestion, the witness replied that they had made part payment of Rs.8,63,665/ against the work done upto May, 2003. He further submitted that only adhoc payment was made against the work done upto May, 2003 and no advance payment was made to them against the work done.
12. I have gone through the crossexamination of the complainant witness and it can be said that no contradiction came out from his crossexamination and he was able to support the case of the complainant. After his examination, CE was closed and statement of the accused u/s 313 Cr. P.C was recorded.
Case No.409/1 Page No. 7 of 3013. In his statement, the accused had stated that he was the Managing Partner of accused no.1 but he was not responsible for day to day affairs of accused no.1 in relation to the present contract as he had delegated his powers to Sh. K.P. Rajappan for management of day to day affairs of the assigned project. He has admitted the execution of contract between accused no.1 and NHAI. He has also admitted the subcontract executed between accused no.1 and the complainant. However, he had denied that the accused no.1 did not have the expertise in executing the assigned project. He further stated that that the complainant company never raised any bill upon accused no.1 and the cheque in question was not issued towards any part payment. He had admitted the liability to the tune of Rs.1.5 lacs towards the complainant company with regard to the work done.
14. He had further stated that the complainant company had asked him to advance them an amount of approx. Rs.7,00,000/ for speedy execution of the project. The amount of the cheque in question, is the total of the amount due and the advance requested. He denied of receiving any legal demand notice personally. In the end he had stated that when the cheque was issued to the complainant company, he had sufficient balance in his other accounts and money was to be transferred from the other accounts Case No.409/1 Page No. 8 of 30 in the account from which the cheque in question was issued. Since the complainant was not duly performing its part of the contract, funds were not transferred to the account from which the cheque was issued and that is why the cheque got dishonoured for the reasons "insufficient funds".
15. After recording statement of accused, the accused was called upon to lead DE. The accused no.2 himself stepped into the witness box and deposed as DW 1. He had filed his examinationinchief by way of affidavit which is Ex. CW 1/D1. In his affidavit he had admitted that he is the Managing Partner of accused no.1. He also admitted the contract for assignment of work by NHAI to accused no.1. He further agreed that a subcontract was executed between the complainant and accused no.1 on 27.05.2002. He stated that subcontract was required to be approved by NHAI vide which the complainant was required to submit various documents. The said work was to be completed in 10 months i.e. by 26.03.2003. But the complainant failed to submit the documents. He further stated that all the major equipment for the said work was provided by accused no.1 to the complainant. The said equipment was sold to the complainant and the complainant had requested the accused to allow the complainant to make five equal installments on the balance amount of the agreed sale consideration as he was short of Case No.409/1 Page No. 9 of 30 funds and requested the accused to recover the payment of installments from the work bills bimonthly. The complete account with respect to the accounts between the complainant and accused no.1 is Ex. R2/A.
16. He further stated that even without giving the required documents by the NHAI and getting the approval from NHAI, the complainant started executing the work with a slow pace in order to get illegal gratifications from the accused. Subsequently there was steep hike in the cost of basic items such as labour, cement, steel and other items. Moreover due to complainant's own failure in properly executing and planning the work given, the complainant started writing unwarranted letters to the accused and started claiming different amounts of money from the accused on different accounts.
17. He further stated that from 25.03.2003 to 14.05.2003 the complainant wrote around 12 letters to the accused, copies of which are on record exhibited as Ex. R2/C to Ex. R2/G. He further stated that since the complainant was facing financial hardship, the complainant approached them with a request to release their security deposit which was duly released by the accused so that the complainant could expedite the work. He further stated that since Case No.409/1 Page No. 10 of 30 he was the Managing Partner of the accused firm and was constantly travelling on all the projects, he was not able to personally look after the present work and, therefore, he had deputed Sh. K.P. Rajjappan for looking after the said work.
18. He further stated that he and Sh. K.P. Rajjappan were jointly operating the accounts from which the cheque in question was issued and when he came to know that the complainant was not performing the work properly, he issued a show cause notice dated 18.05.2003 to Mr. Ajit Singh Bhandari of the complainant company. The show cause notice dated 18.05.2003 is also on record as Annexure 2. He further stated that in June 2003 Sh. Ajit Singh Bhandari alongwith his son Mr. Arjun Singh Bhandari, Directors of the complainant, visited the office of the accused and requested for advancing an amount of Rs.10 lacs. After deducting their balance debit to the accused, a cheque of Rs.8,63,665/ was issued on the account prepared by Sh. K.P. Rajappan and it was subject to the promise made by the complainant that they would expedite the work.
19. He further stated that when the cheque was issued, the complainant was categorically told that this cheque would only be honoured after fulfillment of the promise made by them i.e. to Case No.409/1 Page No. 11 of 30 expedite the work. He again stated that there were sufficient funds in the account of the accused company and as on 08.06.2003 the account of accused no.1 was having balance to the tune of Rs.1,01,00,248/ and on 09/10.06.2003 a total amount of Rs.13,00,000/ was withdrawn to be deposited in the site account of UCO Bank, from which the cheque in question was issued. However, since the complainant were not able to honour the commitment made by them, the said amount was not deposited in the credit account of the joint venture. The bank statement is Ex. R2/H.
20. He further stated that payment for the month of May 2003 for the whole work was received on 19.06.2003 was amounting to Rs.33,15,640/ and the same was deposited in the site account of UCO Bank. Statement showing the same is Ex. R2/I. He further stated that vide letter dated 10.07.2003 the conditional sub contract was terminated and the complainant was asked to make their final accounts jointly. Since the complainant had not fulfilled their commitment as was agreed between them, there was no occasion to present the said cheque for encashment and there was no liability upon the accused to make any payment to the complainant.
21. Thereafter, the witness Vinod Goel was crossexamined by Case No.409/1 Page No. 12 of 30 Ld. Counsel for the complainant wherein he had stated that he was the resident of C20, M.P. Enclave, Pitampura, New Delhi34. He admitted that the cheque in question has been signed by him on behalf of You One Maharia i.e. accused no.1. He further admitted that the cheque in question was issued for an amount of Rs.8,63,665/ after deducting the balance debit of the complainant towards accused no.1.
22. Thereafter Sh. M.K. Sharma was examined as DW 2, who was concerned official from Indian Overseas Bank, Rohini Branch, Delhi. He had brought the statement of account of accused no.1 for the period 01.03.2003 to 30.07.2003, which is Ex. DW 3/A, and statement of M/s Maharia Resurfacing for the period 01.03.2003 to 30.07.2003 is Ex. DW 3/B. After his deposition DE was closed and arguments were heard.
23. Ld. Counsel for the complainant has argued that the complainant has been able to prove the guilt of the accused beyond all reasonable doubt as most of the complainant's case has been admitted by the accused himself. The accused has admitted the agreement between NHAI and accused no.1 and the subcontract and that the complainant has performed some work pursuant to the subcontract between the parties. The accused has further admitted Case No.409/1 Page No. 13 of 30 that there was liability to the tune of Rs.1.5 lacs towards the complainant, which further strengthens the case of the complainant. The onus was upon the accused to rebut the presumptions raised against him but he has failed to do do. On these grounds Ld. Counsel for the complainant has argued that the accused has failed to rebut the presumptions raised against him and therefore he is liable to be convicted.
24. On the other hand Ld. Counsel for the accused has argued that he has been able to bring on record sufficient evidence to rebut the presumptions raised against him. He has further argued that one of the essential condition for an offence u/s 138 N.I. Act is that legal demand notice must be served upon the accused and it is only when the drawer of the cheque fails to make payment within 15 days of receipt of the notice, a complaint u/s 138 N.I. Act can be filed. But in the present complaint no legal demand notice has been sent to accused no.2. Moreover the notice was sent through courier on which neither there was any proper address nor it mentions as to who has received the said notice and, therefore, it can not be relied upon. He has further argued that legal demand notice has been sent through courier which was not a valid mode u/s 138 of N.I. Act in the year 2003 and the courtier company i.e. DTDC, through which the legal demand notice was sent, was not approved by any competent court in the year 2003.
Case No.409/1 Page No. 14 of 3025. He has further stated that the subcontract entered into between the complainant and the accused was conditional and the complainant was bound to perform the contract as per the terms and conditions thereof. But since the complainant had failed to comply with the terms and conditions of the agreement, the accused was not liable to make any payment to the complainant. The cheque in question was issued as advance payment only till June, 2003 whereas the complainant company had executed the work only to the tune of Rs.1,63,665/ and out of the total amount of Rs.8,63,665/, Rs.7,00,000/ was paid as advance payment for the execution of the work. There were sufficient funds in the other accounts of the accused company and had there been any liability upon the accused, the accused company would have transferred the funds to the account from which the cheque was issued. But since the complainant himself failed to honour the agreement, the accused deliberately did not deposit amount in the account so as to stop the complainant from misusing the cheque in question.
26. He further submitted that the complainant company instead of executing the contract in its letter and spirit, committed fundamental breaches of the contract by not executing the work under the subcontract at the site BOQ No.5. The complainant Case No.409/1 Page No. 15 of 30 company did not execute any work in the month of October 2002, January 2003, February 2003 and ultimately, the complainant company stopped the work and abandoned the site in July, 2003.
27. Ld. Counsel for the accused has further submitted that subsequently vide letter dated 10.07.2003 the conditional sub contract was terminated and the complainant company was asked to make their final accounts, but neither the complainant company nor its representative submitted any bill to finalize the account. He has further argued that in fact after termination of the contract, the Directors of the complainant company started indulging in illegal activities and forcefully took away two Transit Mixer bearing Nos. UP16C6181 & UP16C6190 from the site of the work, against which a complaint was lodged by the accused on 17.07.2003 with the concerned police station. He further submitted that on 16.07.2003 the Manager of NHAI also wrote a letter in this regard to the Deputy Commissioner of Sonepat, Haryana for taking necessary legal action against the Directors of the complainant company.
28. Ld. Counsel for the accused has further argued that the present complaint is not maintainable as both the parties are bound by arbitration clause duly stipulated in para 19 of the said sub Case No.409/1 Page No. 16 of 30 contract and both the parties have already initiated their respective claim before the arbitral tribunal and the complainant company has included the alleged amount of the cheque in their claim before the arbitral tribunal. He has further stated that the legal demand notice was sent by Sh. S.P. Soni, authorized signatory of the complainant company on 24.06.2003 whereas he had filed his authority letter on 09.06.2008 by way of Board Resolution dated 09.06.2008. Since the notice was issued by Sh. S.P. Soni who was not authorized representative of the complainant company at the relevant point of time, the legal demand notice has no value in the eyes of law. He has further raised an issue that the cheque has been signed by two persons but the complainant has not initiated the present complaint against Sh. K.P. Rajappan, who is the second signatory of the cheque. Thus, the Ld. Counsel for the accused would argue that the present complaint is liable to be dismissed on this sole ground alone.
29. Ld. Counsel for the accused has further argued that the complainant company has itself admitted that it had raised various running bills on the accused but no bill has been filed on record to prove that the cheque in question was issued in discharge of any debt or liability. Hence, no offence u/s 138 N.I. Act is made out. On these grounds Ld. Counsel for the accused has argued that Case No.409/1 Page No. 17 of 30 sufficient evidence has been brought on record to rebut the presumptions raised against the accused whereas the complainant has failed to bring home the guilt of the accused beyond all reasonable doubt and thus the accused persons are entitled to be acquitted.
30. Arguments heard, file perused and I have also gone through the case law cited above.
31. Bare perusal of Section 138 of the NI Act clarifies that five essential ingredients for completing the offence under Section 138 of the Act are as below:
i) Issuance of the cheque in discharge of a legally recoverable debt or liability;
ii) Presentation of the cheque with the bank;
iii) Returning of the cheque unpaid by the drawee bank;
iv) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, and
v) failure of the drawer to make payment within 15 days of the receipt of the notice.Case No.409/1 Page No. 18 of 30
32. It is pertinent to mention here that there are two presumptions of law as mandated by the Negotiable Instruments Act. According to Section 118 (a) of the Act, it shall be presumed that every negotiable instrument was made or drawn for consideration. By virtue of this clause, the Court is obliged to presume that the promissory note was made for consideration or until the contrary is proved. In Mallavarapu Kasivisweswara Rao Vs. Thadikonda Ramulu Firm and Others AIR 2008 SC 2898 it was held as under: "... ... ... 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. To disprove the presumption, defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its nonexistence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist...."
33. According to Section 139 of NI Act "it shall be presumed, unless the contrary is proved that the holder of a cheque received the cheque for discharge in whole or in part, of any debt or other Case No.409/1 Page No. 19 of 30 liability." Under Section 139 NI Act there is a legal presumption that the cheque was issued for discharging a liability and that presumption can be rebutted only by the person who drew the cheque. This presumption can be rebutted by the accused by adducing evidence. So the burden of proof is on the accused.
34. In Hiten P. Dalal Vs. Bratindranath Banerjee AIR 2010 SC 1898 it was held as under: "The words 'unless the contrary is proved' which occur in this provision (Section 139) make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......".
35. Now it is to be seen whether the accused has been able to rebut the presumptions raised against him and, if yes, whether the complainant has been able to bring home the guilt of the accused beyond all reasonable doubt or not. So far as issuance of cheque is Case No.409/1 Page No. 20 of 30 concerned, the same has not been denied by the accused. Presentment of the cheque for encashment and return of the same for the reasons "insufficient funds" has also not been denied by the accused. Issuance of notice has also been proved and service of notice upon accused no.1 company has also been proved by the complainant.
36. Basically the first defence of the accused is that the legal notice has not been personally served upon accused no.2 as per law, as there is nothing on record to show that notice has been served upon accused no.2. Moreover the notice which has been sent to accused no.1, has been sent through courier only which is not an approved mode of sending of notice. Furthermore it has also not been proved as to who had received the notice on behalf of accused no.1.
37. So far as the first contention of Ld. Counsel for the accused is concerned, this defence is not sustainable as in Section 138 of N.I. Act it has nowhere been prescribed that the notice is to be sent by a particular mode. It only provides that a notice in writing is to be served upon the accused. Sending of notice through courier is not barred and in fact it is well recognized mode by which notice, as envisaged u/s 138 N.I. Act, can be served upon the accused.
Case No.409/1 Page No. 21 of 30The next contention of Ld. Counsel for the accused that the courier company i.e. DTDC was not approved by any competent court in the year 2003 is concerned, this contention is also not sustainable as approval of courier companies was done for the purpose of service of summons and not for legal demand notice. So far as service of legal demand notice is concerned, that can very well be served through courier also as no particular mode of service has been prescribed under the law.
38. It was also one of the contentions of Ld. Counsel for the accused relating to legal demand notice that the notice has not been personally served upon accused no.2. This contention is also not sustainable as the courier receipt Ex. CW 1/8 clearly shows that notice has been sent to the accused persons and it has been received by someone on their behalf. Now whether the same was actually not received by the accused, was to be proved by the accused and not by the complainant. The accused has never denied the address on which the notice was sent. Moreover accused no.2 has himself admitted that he is the Managing Partner of accused no.1 and he is responsible for day to day conduct and affairs of accused no.1.
39. In Ranjit Tiwari Vs. Narender Nayyar 2012 VIII AD Case No.409/1 Page No. 22 of 30 (Delhi)546, the Hon'ble Delhi High Court had observed that notice to the company would imply notice to all those persons who were incharge and responsible for day to day affairs of the company and if notice is served upon the company, such a person cannot deny knowledge about the service of notice. Therefore, notice to accused no.1 is deemed to be notice to accused no.2 as well, as accused no.2 is the Managing Partner of accused no.1.
40. Second defence of Ld. Counsel for the accused is that the dispute between the parties is beyond the purview of Section 138 N.I. Act because Clause 19 of the agreement dated 27.05.2002 clearly states that in case of any dispute the Arbitration Clause as in the main contract shall apply. Hence, in the presence of this arbitration clause, filing of the present complaint is barred. This contention of the accused is also not sustainable as the proceedings u/s 138 of N.I. Act are criminal in nature and it is well settled that no arbitration agreement or arbitration clause can prevent any person from initiating criminal proceedings against the other person. Criminal complaints are not barred by arbitration agreement entered between two parties.
41. In Gurucharan Singh Vs. M/s Allied Motors Ltd. 2006 (2) RCR (Crl.)30 the Hon'ble Supreme Court set aside the orders Case No.409/1 Page No. 23 of 30 of Hon'ble High Court by which the criminal proceedings u/s 138 N.I. Act were stayed till the conclusion of civil proceedings. In this matter in respect of the dispute, arbitrator had passed an award in favour of the accused and complainant had challenged the award in civil proceedings. The complainant case was pending even before the passing of the award by an arbitrator. The Hon'ble Supreme Court had held as under:
"....civil proceedings or arbitration proceedings for recovery and the criminal proceedings under section 138 N.I. Act are based upon independent cause of action. The making of the award may be a defence to such a complaint but to what extent the defence would be valid, shall depend upon the facts and circumstances of the case. Mere making of the award cannot be a ground to stall or stay the proceedings initiated under section 138 N.I. Act"
42. The third and main defence of the accused is that the cheque was not issued in discharge of any legally recoverable debt or liability and it was issued by accused no.1 towards the advance payment to the accused persons for execution of the work assigned to them and since the complainant company failed to comply with the terms and conditions of the agreement, there was no occasion to pay any amount to the complainant.
Case No.409/1 Page No. 24 of 3043. So far as this contention of Ld. Counsel for the accused is concerned, the agreement for execution of work has been admitted by both the parties and it is not in dispute that the complainant company was engaged by the accused for execution of work of eight laning of KM 16.500 to KM 29.300 of NH1 in the State of DelhiNS18(DL). The main contract between NHAI and the accused is also not disputed. Therefore, it has come on record that the complainant was engaged by the accused persons for the execution of the said work. The defence of the accused is that the complainant did not perform part of their contract and that is why the accused was forced to terminate the contract and thus there was no liability upon the accused to make any payment. Now the onus was upon the accused to show that the complainant company had left the work in lurch and they did not perform their part of their contract and that is why there was no liability upon the accused to make any payment. However, the accused persons have failed to bring anything on record to show that the contract was not duly performed by the complainant company.
44. To establish that the complainant company had failed to honour the agreement, the accused has relied upon various correspondences which took place between the complainant and Case No.409/1 Page No. 25 of 30 the accused, which are also part of the record. I have gone through the entire correspondences which have been filed on record. The accused has stated that the cheque in question was issued for Rs.8,63,665/, on request of the complainant to advance them an amount of Rs.10 lacs. The said cheque was issued after deducting the balance debit to the accused and the said cheque was issued in June2003.
45. Now it is not understandable as to if the complainant company was not performing their part of the contract properly then why would the accused had paid an advance amount that too to the tune of Rs.7 lacs as alleged by the accused. On the one hand they are stating that the complainant has not completed the work properly whereas on the other hand the accused had also given advance to the tune of Rs.7 lacs to the complainant, which is totally contradictory to the stand taken by the accused company. Moreover the termination order dated 10.07.2003 is also on record which has been furnished by the accused himself vide which the agreement was terminated by the accused persons. Now if an advance payment of Rs.7 lacs was paid in the month of June2003 then why there is no mentioning of the same in the termination order. If the said amount was paid in advance without any liability then what stopped the accused persons from claiming it back from Case No.409/1 Page No. 26 of 30 the complainant while terminating the contract assigned to the complainant. The last para of termination order dated 10.07.2003 is reproduced hereunder:
"You are therefore advised to immediately carry out your final measurement of the works carried by you and finalize your account by paying us the rental of machines used by you and the liquidated damages for delaying the project by your unprofessional approach and behaviour and by accounting the incomplete work done by you. Within seven days time you are advised to finalize this account with our Project Manager Mr. B.K. Sahu, in failure of doing so we will be forced to take over the site from you, for which only you will be responsible.".
46. In the termination order the amount claimed by the accused was only towards rental of machines used by the complainant, liquidated damages for delaying the project and for the incomplete work done. Advance payment of Rs.7 lacs which was paid just one month back has not been claimed by the accused, which puts a doubt in the case of the accused that it was paid as an advance payment only and not in discharge of any legally recoverable debt or liability. Moreover it further strengthens the case of the complainant that some amount of work was in fact done by the Case No.409/1 Page No. 27 of 30 complainant for which the accounts were to be settled between the parties.
47. Another contention was that when the legal demand notice was sent, Sh. S.P. Soni was not authorized by the complainant. This contention is not sustainable as it is well settled that the principle can rectify acts of agent both prospectively as well as retrospectively. Once, board resolution has been passed in favour of Sh. S.P. Soni, this defect stands rectified. Lastly Ld. Counsel for the accused has argued that Sh. K.P. Rajappan, who is also one of the signatories of the cheque, has not been arrayed as an accused. This argument also does not hold ground as this a criminal complaint and it was the prerogative of the complainant to not to make Sh. K.P. Rajappan as an accused. The concept of necessary party as in civil case has no applicability in criminal complaints.
48. Ld. Counsel for the accused has relied upon the following case laws : 1) Shakti Travel & Tours Vs. State of Bihar JT2000(7) SC 563, [2000]102 Comp Cas 409(SC); 2) HDFC Bank Vs. Amit Kumar Singh 160(2009) DLT 478; 3) M.S. Narayana Menon @ Mani Vs. State of Kerala and Anr. AIR 2006 SC 3366 and 4) John K. John Vs. Tom Vargese and Anr. AIR 2008 SC 278.
Case No.409/1 Page No. 28 of 3049. None of the case laws cited above, is applicable in the present case as facts of the present case are quite different from the facts of the cases referred to by Ld. Counsel for the accused. The judgments Shakti Travel & Tours Vs. State of Bihar (supra) and HDFC Bank Vs. Amit Kumar Singh (supra) are not applicable as in the present case there is clear averments in the complaint as well as in the affidavit that the notice was duly served upon all the accused persons and the acknowledgement is also on record Ex. CW 1/8. The judgments M.S. Narayana Menon @ Mani Vs. State of Kerala and Anr (supra) and John K. John Vs. Tom Vargese and Anr (supra) are also not applicable as in those cases the facts were such that the accused was able to rebut the presumptions raised against him, which is not the case in the present case for the reasons already mentioned in the previous paragraphs. Otherwise also in John K. John Vs. Tom Vargese and Anr (supra) the case is based on chitty funds being run by the complainant and the accused was the subscriber of chitty funds being run by the complainant. But it is not the case under consideration. So far as judgment M.S. Narayana Menon @ Mani Vs. State of Kerala and Anr (supra) is concerned, there is no dispute on the law being laid down by the judgment, however, it is not clear as to how it would help the case of the accused when he has failed to rebut the presumptions raised against him. Thus, none Case No.409/1 Page No. 29 of 30 of the case laws cited by Ld. Counsel for the accused is applicable in the facts and circumstances of the present case.
FINAL ORDER
50. Hence, in the end it can be said that the complainant has proved beyond all reasonable doubt the guilt of the accused whereas the accused has failed to rebut the presumptions raised against him. Accordingly, the accused no.1 & 2 stand convicted u/s 138 of N.I. Act.
Announced in the open Court on 25th April, 2015 (PUNEET PAHWA) MM (NI ACT1) PATIALA HOUSE COURTS NEW DELHI Case No.409/1 Page No. 30 of 30 IN THE COURT OF SHRI PUNEET PAHWA METROPOLITAN MAGISTRATE 01 (N.I. ACT) PATIALA HOUSE COURTS : NEW DELHI M/s Bhandari Engineers & Builders Pvt. Ltd.
803, Bhandari House, 91, Nehru Place, New Delhi110019.
....................... Complainant Vs.
1. M/s You One MahariaJV, A10, Panchvati, Azadpur, New Delhi110033.
2. Mr. Vinod Goel, Managing Partner, M/s You One MahariaJV, A10, Panchvati, Azadpur, New Delhi110033.
ORDER ON SENTENCE
At 3:35 p.m.
Present: None for complainant.
Sh. Rakesh Wadhwa, Ld. Counsel for convict alongwith convict in person.
Case No.409/1 Page No. 3 of 3Arguments on quantum of sentence advanced by Ld. Counsel for the convict heard.
It is pertinent to mention here that on 25.04.2015 the judgment was announced and since then the case is being adjourned due to non availability of the counsels of both the parties. However, parties were directed to file written submissions and the convict has filed the written submissions on quantum of sentence. But despite directions no one has appeared on behalf of the complainant nor any written submission have been filed till now. Hence, I am proceeding to announce quantum of sentence in the absence of the complainant.
Ld. Counsel for the convict has argued that the convict has good name in the society and has never been involved in any criminal matter. He has argued that the cheque in question was never issued by the convict in discharge of any legally enforceable debt or liability and in fact it was issued as advance cheuqe which has been misused by the complainant just to harass the convict. He has further argued that the convict is the sole bread earner of his family and he is suffering from illness for the last eight months. He further argued that the convict is facing huge financial crisis and he is not even able to pay the college fee of his son who is pursing degree course. On these grounds Ld. Counsel for the convict has prayed for taking a lenient view against the convict.
Heard. Admittedly the present complaint was filed way back in the month of July, 2003 and since then a period of around 12 years has Case No.409/1 Page No. 3 of 3 elapsed. However, the convict can not be solely held responsible for the delay in trial. Therefore, from the entire facts and circumstances of the case, this court is of the view that sentence of imprisonment shall not be apt punishment in the present case. However, this court deems it fit to take the convict in custody till rising of the court and the convict is further directed to compensate the complainant by paying an amount of Rs.17,27,330/ (Rs. Seventeen Lacs Twenty Seven Thousand Three Hundred Thirty Only) i.e. double of the cheque amount, within one month from today and in case of default in payment of compensation to the complainant, the convict shall be liable to undergo Simple Imprisonment for One month. Copy of judgment and order on sentence be given to the convict free of cost.
File be consigned to record room after due compliance.
Announced in the open Court on 19th May, 2015 (PUNEET PAHWA) MM (NI ACT1) PATIALA HOUE COURTS NEW DELHI Case No.409/1 Page No. 3 of 3