Delhi District Court
Prabhakar Nirma vs . Vishnu Prakash Dubey on 21 October, 2021
IN THE COURT OF MS. MEDHA ARYA MM (N.I. ACT03) SOUTHWEST: DWARKA COURTS: NEW DELHI CNR No.DLSW020130412019 Ct. Case No.11542/2019 PS: Dabri U/s.138 N.I. Act. Prabhakar Nirma Vs. Vishnu Prakash Dubey Date of Institution of case: 06.04.2013 Date of which Judgment reserved: 06.10.2021 Date on which judgment pronounced: 21.10.2021 JUDGMENT
1) Unique ID no. of the case : DLSW020130412019
2) Name of complainant : Prabhakar Nirman
S/o Late Sh. Vedpal Singh
R/o F/85, A1 (Extn.) Jeewan Park,
Pankha Road, Janakpuri,
New Delhi11059
3) Name and address of accused : Vishnu Prakash Dubey
S/o Sh. Shambhu Nath
R/o 34, Manas Kunj, Uttam Nagar,
New Delhi110059
4) Offence complained of : Section 138 N.I. Act
5) Plea of accused : Not guilty and claim trial
6) Final Order : Convicted for the offence punishable
U/s.138 N.I. Act
7) Date of order : 21.10.2021
Pg. 1 of 36 C.C. No.11542/2019
BRIEF REASONS FOR DECISION
1. Pending since 2013, the above captioned complaint was filed by the complainant against the accused Vishnu Prakash Dubey consequent upon the dishonour of four cheques in question issued in his favour by the accused towards repayment of the friendly loan of Rs.6,00,000/. The details of the 'cheques in question', which form the basis of instant complaint, are as follows:
(i) Cheque bearing no. 036783 dated 08.12.2012 in sum of Rs.1,50,000/ drawn on SBI, Uttam Nagar, Delhi.
(ii) Cheque bearing no. 036784 dated 08.01.2013 in sum of Rs.1,50,000/ drawn on SBI, Uttam Nagar, Delhi.
(iii) Cheque bearing no. 036776 dated 25.12.2012 in sum of Rs.1,50,000/ drawn on SBI, Uttam Nagar, Delhi.
(iv) Cheque bearing no. 036778 dated 25.01.2013 in sum of Rs.1,50,000/ drawn on SBI, Uttam Nagar, Delhi.
2. It is the case of the complainant that he had advanced a friendly loan of Rs 6 lacs to the accused herein, Vishnu Prakash Dubey as the latter was raising construction of his house at the plot bearing no.RZ34, Manisha Kunj, Uttam Nagar Pg. 2 of 36 C.C. No.11542/2019 and needed the money to meet the shortfall of funds required for the construction. For seeking this loan, the accused and his wife had approached the complainant with a common friend, Santosh kumar Dubey. At the first instance, the complainant advanced an amount of Rs.3,00,000/ as a loan to the accused, when he was assured by the said Santosh kumar Dubey about the repayment of the loan. As averred in the complaint, the complainant advanced the loan also in view of the claims of Santosh kumar Dubey to the previous dealings between the complainant and the accused. Subsequently, the accused again approached the complainant on 10.04.2012 with his wife as well as Santosh Kumar, for a further loan of Rs 3 Lacs. On the said date, the complainant was in the company of one Sahid Ali Khan. On this date, the complainant was assured by Santosh Kumar that that the entire amount of Rs.6,00,000/ will be duly repaid by the accused. Santosh kumar Dubey also assured the complainant of the repayment of the loan amount by informing him that he has also advanced a loan of Rs 4 Lacs to the accused and his family. The accused also said that in lieu of the loan amount, the accused shall transfer the ownership of one of the floors of his building in favour of the complainant. The complainant, consequent upon this assurance, advanced a further loan of Rs.3,00,000/ to the accused. Subsequently, the complainant approached the accused, his wife as well as Santosh Kumar to seek the possession of the floor of the building promised to him. However, the accused refused to transfer the floor in favour of the complainant by stating that the title of the property is not in his name. The complainant then gauged the apparent malafide intention of the accused and sought a Pg. 3 of 36 C.C. No.11542/2019 refund of his loan amount, and warned him of legal consequences if he failed to repay the same. Consequent thereto, aforedescribed cheques in question were issued by the accused in favour of the complainant. The complainant was given the assurance that the cheques shall be duly honoured upon their presentation. However, to the utter dismay of the complainant, all the four cheques were dishonoured upon presentation with remarks 'funds insufficient' vide separate return memos, all dated 30.01.2013. Statutory Legal Demand notice dated 21.02.2013 was duly served by the complainant upon the accused but even after the lapse of 15 days from the date of service of the notice, the accused failed to repay the loan amount to the complainant, for which reason the complainant was constrained to approach this court by way of the above captioned complaint. It is averred in the complaint that the same has been filed within the limitation of Section 142 of N.I. Act and the territorial jurisdiction to entertain the complaint vests with this court.
3. The complainant was duly examined u/s.200 CrPC. In his pre summoning evidence, complainant examined himself as CW1. As a witness stands as CW1 the complainant relied upon evidence affidavit Ex.CW1/1, the contents of which are not reproduced herein in the interest of brevity, the same being in consonance with contentions in the complaint. The complainant also relied upon the following documents in his evidence Pg. 4 of 36 C.C. No.11542/2019
(i) Cheque bearing no. 036783 Ex CW1/A
(ii) Cheque bearing no. 036784 Ex CW1/B
(iii) Cheque bearing no. 036766 Ex CW1/C
(iv) Cheque bearing no. 036778 Ex CW1/D
(v) Cheque return memo qua cheque Ex CW1/A being Ex CW1/E
(vi) Cheque return memo qua cheque Ex CW1/D being Ex CW1/F
(vii) Cheque return memo qua cheque Ex CW1/C being Ex CW1/G
(viii) Cheque return memo qua cheque Ex CW1/B being Ex CW1/H
(ix) Copy of Legal Notice Mark A
(x) Speed Post Receipts Ex CW1/I
(xi) Tracking report Mark B
(xii) Police complaint dated 04.04.2013 Mark C Upon examining presummoning evidence and hearing the complainant on the point of summoning, the accused was summoned to face trial for the offence punishable u/s.138 N.I. with respect to the aforementioned cheques in question.
4. The accused duly entered appearance and the substance of accusation against him was explained to the accused by way of formal notice u/s.251 CrPC. After the accusation against him was explained to him, the accused was given an opportunity to elaborate his plea of defence and at this stage, the accused stated that he owes no liability to the complainant and the cheques in question do not bear his Pg. 5 of 36 C.C. No.11542/2019 signatures. The accused pleaded ignorance as to how the cheques in question came in possession of the complainant but stated that the complainant used to visit his house with one person namely, Santosh. The accused further stated that he had not filed any police complaint after misplacing the cheques. He also stated that although the address mentioned on the legal demand notice is correct, he did not receive any statutory legal demand notice from the complainant. The accused pleaded not guilty to the offence and claimed trial. Thereafter, upon an application of the accused u/s.145(2) N.I. Act, the accused was permitted to cross examine the complainant.
5. The proceedings of the case thereafter progressed to the stage of C.E. At the stage of C.E., the complainant adopted his presummoning evidence tendered on the affidavit Ex.CW1/1 and also placed reliance on the documents Ex.CW1/A to Ex.CW1/I, and MarkA to MarkC. The complainant also relied upon the document i.e. copy of the chargesheet emanating from FIR No.113/13, PS Dabri, MarkD (Colly.).The complainant was cross examined at length by the accused. Thereafter, he was discharged as a witness.
6. No other witnesses were examined by the complainant and C.E. was closed vide order dated 21.01.2020.
Pg. 6 of 36 C.C. No.11542/2019
7. Thereafter, the statement of the accused was recorded u/s.313 CrPC. At this stage, the accused reiterated the stand taken by him earlier that he does not know the complainant, and had not approached the complainant for seeking any loan. He stated that he never gave the cheques in question to the complainant and has no idea as to how the cheques came into the possession of the complainant. He further stated that he never got to know about the dishonour of cheques in question and did not even receive the legal demand notice. Curiously enough, while the accused had stated at the stage of service of notice upon him u/s.251 CrPC that the complainant used to visit the house with one Santosh, at this stage, he resiled from the stand and stated that he does not know the complainant at all. The accused opted to lead D.E in the affirmative.
8. At the stage of D.E., the accused examined Sh. Rajbir Singh Dabas, Customer Associate, SBI, Uttam Nagar Brach as DW1. DW1 adduced on record certified copies of documents contained the specimen signature of the accused as well as the certified copies of the account opening form Ex.DW1/1 (Colly.) In his cross examination, DW1 accepted as correct the suggestion that he has not brought on record the original document containing the specimen signature or the original account opening form but volunteered that original documents are stored by bank in a centralized database and whenever the copy of document is required, the same is received by branch via email. DW1 denied the suggestion that Pg. 7 of 36 C.C. No.11542/2019 the DW1/1 (Colly.) has not been proved as per rules of the Banker's Book Evidence Act. DW1 was discharged as a witness after this limited crossexamination.
9. No other witness was examined by accused and D.E. was closed upon statement of accused vide order dated 10.09.2021.
10. The hearing of the case thereafter proceeded to the stage of final arguments. Final arguments were advanced by both the parties.
Ld. Counsel for the complainant submitted that the offence of Section 138 N.I. Act is based on the theory of reverse onus of proof, as there exists a presumption in favour of the complainant that the cheques in question were issued in his favour by the accused in discharge of legally enforceable liability. It was submitted by counsel for the complainant that the accused has not been able to discharge the burden of proof placed upon him, and is therefore liable to be convicted for the offence u/s.138 N.I. Act with respect to the cheques in question. Ld. Counsel adverted the attention of this court towards the document MarkD and stated that the document contains the admission of the accused as well as his wife of their liability towards the complainant. It was further submitted that although the accused has denied the signatures on the cheques in question, no expert evidence on this point was led by the accused and therefore the accused has not been able to prove that the cheques in Pg. 8 of 36 C.C. No.11542/2019 question do not bear his signatures. Ld. Counsel submitted that loan Rs.6,00,000/ was advanced by the complainant to the accused, in view of fact that previously also a loan was advanced by the complainant to the accused and the same was duly repaid by the accused, as is evident from the document Mark B. Ld counsel for the complainant argued that the accused has taken contradictory stands during the trial, and has not been able to prove his version even on a scale of preponderance of probabilities. It was vehemently submitted that the accused has not been able to rebut the presumption of Section 139 NI Act, and deserves to be convicted.
Per contra, Ld. Counsel for the accused submitted that the accused deserves to be acquitted for the offence in question as he has been able to duly discharge the burden placed upon him by virtue of Section 139 N.I. Act. Ld. Counsel for the accused has adverted the attention of this court to the crossexamination of the complainant/CW1, wherein CW1 had admitted that the loan of Rs.3,00,000/ was duly repaid by the accused within 1520 days of its advancement. Ld. Counsel vehemently submitted that this portion of the testimony of CW1 is itself sufficient to dispel burden of proof placed upon the accused, on a scale preponderance of probabilities. Further, other discrepancies such as CW1 being unable to adduce the documents on record pertaining to the sale of property, sale consideration of which was allegedly the source of funds from which the complainant advanced the loan to the accused, the failure of CW1 to even specify the complete address of this property etc. were pointed out by the accused. It was submitted that accused rebutted the onus placed upon him by virtue of Pg. 9 of 36 C.C. No.11542/2019 S.139 N.I. Act and as the complainant failed to prove his case beyond reasonable doubt thereafter, the accused deserves to be acquitted.
Ld. Counsel for the accused has also placed reliance of the following judgment in support of his case
(i) Lyca Finance Ltd. Vs. State & Ors. MANU/DE/3869/2016
(ii) Veerayya Vs. G.K. Madivalar 2011 SCC Online Kar 4220
(iii) Basalingappa Vs. Mudibasappa MANU/SC/0502/2019
(iv) K. Subamani Vs. K. Damodar Naidu MANU/SC/1031/2014
(v) Vijay Vs. Laxman MANU/SC/0125/2013
(vi) Kanshi Ram Bansal Vs. Suman malhotra MANU/DE/1633/2012
(vii) Murarilal Vs. State of MP MANU/SC/0189/1979
(viii) Shree Corporation vs Anilbhai Puranbhai Bansal MANU/GJ/0379/2018 In rebuttal, Ld. Counsel for the complainant strenuously argued that the testimony of CW1 in his cross examination regarding the repayment of the loan amount does not aid the case of the accused, as it is not the case of the accused that he had sought a loan and subsequently repaid the same to the complainant, but that the accused never sought any loan from the complainant. The attention of this court was Pg. 10 of 36 C.C. No.11542/2019 again adverted to the document MarkD allegedly containing the admission of liability of the accused in favour of the complainant, and it was submitted that these admissions should be considered together with the factor of inconsistency of the accused during trial, as leading to the conclusion of the guilt of the accused.
11. This court has heard the parties in light of evidence on record. Considered.
12. It would be apposite at the stage to briefly discuss law applicable to the defence of dishonour of cheque before finding of conviction. The legal position that emerges, from a reading of S.138 N.I. Act, is that before finding of conviction with the offence punishable under Section 138 N.I. Act can be returned against the accused, it has to be established, cumulatively
(i) that the cheque in question was issued by the accused in favour of the complainant for the discharge of legally enforceable liability.
(ii) presentation of the cheque to the bank within three months from the date on which it is drawn or within the period of its validity, whichever is earlier;
Pg. 11 of 36 C.C. No.11542/2019
(iii) a demand being made in writing by the payee or holder in due course by the issuance of a notice in writing to the drawer of the cheque within thirty days of the receipt of information from the bank of the return of the cheques; and
(iv) the failure of the drawer to make payment of the amount of money to the payee or the holder in due course within fifteen days of the receipt of the notice.
The legal position was discussed by the Hon'ble Supreme Court of India in MSR Leathers vs. S. Palaniappan (2013) 1 SCC 177 , wherein it was held thus, "12. The proviso to Section 138, however, is all important and stipulates three distinct conditions precedent, which must be satisfied before the dishonour of a cheque can constitute an offence and become punishable. The first condition is that the cheque ought to have been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier. The second condition is that the payee or the holder in due course of the cheque, as the case may be, ought to make a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, Pg. 12 of 36 C.C. No.11542/2019 within thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid. The third condition is that the drawer of such a cheque should have failed to make payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice. It is only upon the satisfaction of all the three conditions mentioned above and enumerated under the proviso to Section 138 as clauses (a), (b) and (c) thereof that an offence under Section 138 can be said to have been committed by the person issuing the cheque."
This court shall now examine if the four ingredients as described in the forgoing paragraph have been satisfied in this case.
13. The cheques in question Ex.CW1/A, Ex.CW1/B, Ex.CW1/C & Ex.CW1/D are dated 08.12.2012, 08.01.2013, 25.12.2012 and 25.01.2013 respectively. As per case of the complainant, the cheques in question were presented for encashment within the period of their validity as per law.No challenge has been made to this part of the complainant by the accused. Accordingly, condition (ii) above stands satisfied.
Pg. 13 of 36 C.C. No.11542/2019
14. As regards the service of statutory legal demand notice, the complainant both in his presummoning evidence and postsummoning evidence has stated that legal notice MarkA was duly served upon the accused. The accused denied the service of legal demand notice, but stated at the time when he put forth his plea of defence u/s.251 CrPC that the address mentioned on the legal demand notice is correct. As such, a presumption can be drawn u/s.27 General Clauses Act that the legal demand notice was duly served upon the accused. It is pertinent to mention here that the accused gave a suggestion to CW1, during his cross examination, that the legal notice notice was not sent by the complainant to the accused at the correct address. However, in the absence of any evidence in the affirmative to this effect, and an admission by the accused himself to the contrary, the suggestion does not much aid the accused. Even otherwise, if the version of the accused to the extent that the legal notice was not served upon is believed, the accused can still not take any benefit as he failed to payment amount of the cheques in question to the complainant despite having been served with the process of the above captioned complaint. At this juncture, this Court seeks guidance from the law laid down by the Hon'ble Supreme Court of India in C.C. Alavi Haji v. Palapetty Muhammed, (2007) 6 SCC 555 wherein it has been held as follows :
"17. It is also to be borne in mind that the requirement of giving of notice is a clear departure from the rule of criminal law, where there is no stipulation of giving of a Pg. 14 of 36 C.C. No.11542/2019 notice before filing a complaint. 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 notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the GC Act and Section 114 of the Evidence Act. In our view, any other interpretation of the proviso would defeat the very object of the legislation. As observed in Bhaskaran case [(1999) 7 SCC 510 : 1999 SCC (Cri) 1284] if the "giving of notice" in the context of Clause (b) of the proviso was the same as the "receipt of notice" a trickster cheque drawer would get the premium to avoid receiving the notice by adopting different strategies and escape from legal consequences of the Act."
Pg. 15 of 36 C.C. No.11542/2019 Accordingly, condition no.(iii) & (iv) above also stand satisfied, as it is a matter of record that the accused had due notice of pendency of the present complaint, despite which he failed to make the payment of cheques in question to the complainant.
15. Now it remains to be seen if the cheques in question Ex.CW1/A, Ex.CW1/B, Ex.CW1/C & Ex.CW1/D were issued by the accused in favour of the complainant in discharge of legally enforceable debt.
16. At this stage, it becomes imperative to mention Section 139 of the Negotiable Instrument Act, 1881 which carves out a presumption in favour of the drawee that the cheque was issued to him in discharge of a debt or other liability of a legally enforceable nature. Also, the said provision must be read alongwith the Section 118 of the same enactment which spells out another presumption in favour of the drawee that every negotiable instrument was 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.
Pg. 16 of 36 C.C. No.11542/2019
17. The first point of determination is as to whether presumption under Section 138 R/w S.118 N.I. Act can be raised against the accused. In the case at hand, the accused has denied the signatures on the cheques in question. In order to establish that the signatures on the cheques in question have not been appended by him, the accused, at the time of leading defence evidence in the affirmative, relied upon the testimony of DW1, who brought on record the specimen signatures of the accused given by him when he opened his bank account, as well as the bank account opening form Ex DW1/1 (colly). The accused also relied on the judgment of the Hon'ble High Court of Delhi in Kanshi Ram Bansal (Supra), wherein it has been held that the best witness in case of denial of signatures of the drawer of a cheque, to establish that the signatures do not belong to the drawer, wouldbe the concerned bank manager and not a handwriting expert. Reliance on this judgment by the accused seems misplaced, as despite reliance, the accused did not summon the bank manager as a witness but only called on record the documents containing the specimen signatures of the accused. The cheques in question have been dishonoured for reason of insufficiency of funds. The accused did not summon the bank manager who could have opined that signatures on the said cheques in question did not belong to the accused. Instead, only the documents Ex DW1/1 were summoned on the record, and an appeal was made to this Court to exercise its powers under Section 73 of the Indian Evidence Act, 1872 and compare the signatures on the cheques in question with those on the documents Ex DW1/1 (colly) or those on record otherwise. Now, it has been held in a catena of Pg. 17 of 36 C.C. No.11542/2019 judgments that though the court has the power to compare the signatures on the questioned document with the admitted signatures of the party, this power has to be used sparingly as the court cannot substitute an expert. In the case at hand, the accused chose to not examine any expert witness to establish his defence that the signatures on the cheques in question do not belong to him. Infact, it was argued that calling an expert witness was not necessary for the accused. At this juncture, it becomes necessary to refer to the judgment of Murari Lal versus State of MP (supra) wherein the Hon'ble Supreme Court of India has held that the testimony of an expert witness is only an opinion, and not binding upon the Court. This judgment would have come to the aid of the accused if there were contradictory testimonies of experts qua his signatures on the cheques in question , or any other evidence qua the signatures. No other evidence to prove that the signatures on the cheques in question are not those of the accused has been brought on record. The accused has neither filed any complaint of forgery against the complainant, nor did he file a complaint to report the theft of his cheques, which could have atleast corroborated his version. Taking a defence to the effect that signatures on the cheques do not belong to him and not being able to prove this defence is a circumstance against the accused, and he cannot hide behind the excuse that it was not necessary for him to examine an expert witness, the opinion of the latter being only an opinion and not conclusive in nature.
Be that as it may, this court has also compared the signatures on the cheques in question on the documents brought on record by DW1 as well as on the Pg. 18 of 36 C.C. No.11542/2019 affidavit and other documents where the accused has appended his signatures before this court such as the notice framed under section 251 CrPC or the statement of the accused recorded under section 313CrPC. Prima facie, after accounting for certain natural deviations in handwriting, the signatures on all the cheques in question appear to have been appended by the accused himself. Accordingly, the defence taken by the accused that the cheques in question do not contain his signatures is hereby rejected. Axiomatically, a presumption is raised against the accused under Section 139/118 of the NI Act that the cheques in question were given by the accused to the complainant towards discharging a legally enforceable liability. This despite the fact that the remaining particulars on the cheques in question do not appear to be filled by the accused. This is so as it is well settled that the person issuing a cheque is presumed to authorize a holder thereof to fill up the blanks, and cannot establish his liability on this ground alone. Section 22 of the Negotiable Instrument Act assumes relevance here, which states that prima facie, the holder of an inchoate negotiable instrument has the authority to complete the document. Reliance in this regard can also to be placed of Hon'ble High Court of Delhi in 'Jaspal Singh Vs. State (Govt. of NCT. Of Delhi) 2016 SCC OnLine Del 6007. In view of legal position, this court is of the considered opinion, presumption u/S.139 R/w S.118 N.I. Act can duly be raised against the accused.
18. The offence of Section 138 NI Act being premised on the theory of Pg. 19 of 36 C.C. No.11542/2019 reverse onus of proof, the next point of determination is whether the accused has been able to discharge the onus of proof placed upon him. The journey of trial qua a complaint under Section 138 NI Act commences, after a determination is made that the presumption as per Section 139/118 Negotiable Instruments Act, 1881, can be raised against the accused, from the point of the accused who is required to prove that the cheque in question was not given for a consideration or for the discharge of any legally enforceable debt. In this regard, reliance can be place on Hiten P. Dalal Vs. Bratindranath Banerjee (2001) 6 SCC 16 wherein it was held as under: "22. Because both Sections 138 and 139 require that the Court `shall presume' the liability of the drawer of the cheques for the amounts for which the cheques are drawn, ..., it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption has been established. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused. Such a presumption is a presumption of law as distinguished from a presumption of fact which describes provisions by which the court may presume a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to Pg. 20 of 36 C.C. No.11542/2019 prove the case against the accused beyond reasonable doubt. 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 probability of the nonexistence of the presumed fact.
23. In other words, provided the facts required to form the basis of a presumption of law exists, the discretion is left with the Court to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, after considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists.
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."
Pg. 21 of 36 C.C. No.11542/2019 In the backdrop of the legal position enunciated above, it is to be examined whether the accused, on a scale of preponderance of probabilities, has led evidence sufficient to discredit the case of the complainant so as to shift the onus placed upon him to the complainant. As held by the Hon'ble Supreme Court of India in Kumar Exports vs Sharma Carpets (2009)2 SCC 513, the accused can either prove the nonexistence of consideration and debt by direct evidence, or by bringing 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 may act upon the plea that they did not exist. If this Court comes to the conclusion that the accused has not been able to rebut the presumptions raised against him, by failing to bring on record direct evidence or by even failing to sufficiently perforate the case of the complainant, the complainant is entitled to a decision in his favour.
19. Simply stated, the accused has to offer on something that makes his version probable. This the accused can do by both successfully raising and proving competing version to the case of the complainant or by perforating the case of the complainant. Opportunity to do this arises for the accused at four stages:
(i) When the accused puts forth defence at the time when his plea of defence as recorded after the substance of acquisition is Pg. 22 of 36 C.C. No.11542/2019 explained to him u/s 251 CrPC
(ii) When the accused cross examines the complainant pursuant to his application u/S.145(2) N.I. Act being allowed,
(iii) When statement of the accused is recorded u/s 313 CrPC and
(iv) When defence witness was examined.
The stand taken by the accused at all these stages shall be examined to determine if the accused could raise a probable defence on the touchstone of benchmark set in the judgment as held by Hon'ble Supreme Court of India in Kumar Exports vs Sharma Carpets (2009)2 SCC 513.
20. As has already been recorded in the foregoing portions of this judgment , to raise a probable defence, the accused has to do something more than to merely offer a reasonable or probable explanation. The accused is required to probabalise his defence to an extent that the explanation offered by him appears to be true. The defence of the accused has to be probabalised by proof and not mere explanation which merely appears to be plausible. With this legal position in mind, this court shall examine if the accused has been able to probabalise the defence put forth by him. To recapitulate, at the time when his plea of defence was recorded after the substance of the accusation against him was explain to the accused, the accused stated that he did not handover the cheques in question to the complainant, but the complainant used to visit his Pg. 23 of 36 C.C. No.11542/2019 house with Santosh Kumar Dubey. In what circumstances, however, the said cheques in question came in possession of the complainant is a fact towards which the accused has offered no explanation. While leading DE in the affirmative, the accused has only examined the bank witness, and no other evidence was adduced by him in the affirmative to show that the cheques in question came in possession of the complainant without his knowledge.In the entire crossexamination of CW1, it was never insinuated that the cheques in question were stolen by the complainant. The fact that the accused never filed a police complaint regarding the fact that he has misplaced the cheques in question also indicates that the cheques were never stolen by the complainant or anyone else. The defence taken by the accused that blank signed cheques somehow came in possession of the complainant without his knowledge is fantastical, and was rendered even more improbable by the fact that the accused failed to give any explanation of any surrounding circumstance which would have made this possible. Suggestions were given to CW1 in his crossexamination that he came in possession of the cheques through Santosh Kumar Pandey. Even if this line of defence, for a moment, is accepted on face value, it was upon the accused to then explain how the cheques came in possession of the said Santosh Kumar Dubey in the first place. Far from examining Santosh Kumar Dubey as a witness in support of his case, not even a suggestion was put to CW1 to atleast bring on record an explanation of the circumstances of the cheques coming in possession of the said Pg. 24 of 36 C.C. No.11542/2019 Santosh Kumar Dubey.
21. As if these lacunas were not enough for the defence of the accused to fail, the accused performed a flipflop when his explanation was sought under section 313 CrPC qua the evidence on the record against him. At this stage, the accused stated that he neither approached the complainant for any loan nor does he even know the complainant. Hitherto, the accused had taken the stand that the complainant used to visit his house with Santosh Kumar Pandey, through whom he was acquainted with the complainant. The accused could not establish the said line of defence. By stating in his examination under 313 CrPC that he does not even know the complainant, the accused further damaged the credibility of his own case. The entire case of the complainant is that he had advanced a loan of Rs.6 Lacs to the accused in two instalments so that the accused could raise construction of his house. Neither by evidence in the affirmative nor by any contrary suggestion did the accused ever say on the record that he was not raising any such construction, or at least not during the period in which the loan is said to have been advanced to him by the complainant. This circumstance also goes on to establish the fact that the accused and the complainant were at least acquainted with each other, and negates the defence taken by the accused that he does not even know the complainant, so no occasion could have arisen for him to hand over the cheques in question to the complainant. To establish that he is Pg. 25 of 36 C.C. No.11542/2019 totally unacquainted with the accused, the accused crossexamined the complainant regarding the knowledge of the complainant of the background of the accused. In his testimony, CW1 stated that the accused has two sons, and also accepted as correct the suggestion that the accused is a tea vendor and carries his business from a stall. CW1 also volunteered that he is aware of the residential address of the accused. This part of the testimony of CW1 in the cross examination further dented the case of the accused that he was completely unacquainted with the complainant and did not give the cheques in question to the complainant. It can safely be concluded that the accused has appallingly failed to establish the defence that the cheques in question came in possession of the complainant without his knowledge. With this, the entire defence of the accused crumbled.
22. It now remains to be seen if the accused has been able to dislodge the burden of proof placed upon him by perforating the case of the complainant. In his crossexamination conducted on 18.09.2019, CW1 deposed that "the amount of Rs.3 Lacs was returned to me by the accused within 15 to 20 days of its advancement." This part of testimony of CW1 formed the fulcrum of the final arguments led by ld counsel for the accused, who submitted that as the complainant/CW1 has himself admitted that the loan advanced by him to the accused was returned by the accused, the complaint's case is liable to fail. It was Pg. 26 of 36 C.C. No.11542/2019 argued that even if the case of the complainant is accepted at face value and it is conceded that a loan of Rs 6 Lacs was indeed advanced by the complainant to the accused, the admission of CW1 would show that the complainant had no occasion to present the cheques in question, and even the statutory legal demand notice for the amount of Rs 6 lacs, served by complainant upon the accused was faulty. Reliance was placed upon the judgment of the Hon'ble High Court of Delhi titled Lyca Finance Ltd (supra), wherein it has been held that if the cheque in question is for an amount greater than the amount of the debt due by the accused to the complainant, Section 138 of Negotiable Instruments Act cannot be attracted. It was vehemently argued by ld Counsel for the accused that even if the case of the complainant is believed to the extent that he had advanced a loan of Rs.6 Lacs to the accused, the fact that the complainant/CW1 admitted the repayment of Rs.3 Lacs weakens the case of the complainant as he could not have presented cheques worth Rs.6 Lacs for encashment. Reliance was also placed on the judgment of the Hon'ble High Court of Gujarat titled Shree Corporation( supra) to argue that the legal notice served by the complainant upon the accused is also defective, as demand for an amount greater than the liability owed by the accused to the complainant was made by the complainant in the said legal notice, and in the absence of a valid legal notice, the ingredients of the offence punishable under Section 138 NI Act were not satisfied. At first blush, this line of defence taken by the accused appears to be credible in as much Pg. 27 of 36 C.C. No.11542/2019 the accused has pointed out at a glaring admission of CW1 himself. A closer scrutiny however reveals the fallacy of this argument. First off, it has been the consistent defence of the accused throughout that no loan was ever taken by him from the complainant and he does not know how the cheques in question came in possession of the complainant. As such, by relying on the testimony of CW1 regarding the repayment of the loan amount, the accused seems to be indulging in the policy of "heads I win, tails you lose". This part of testimony of CW1 would have come to the aid of accused had he taken the defence all along that he had indeed obtained a loan from the complainant, but had repaid the loan or at least a part of the loan. Such is not the case at hand. Ld. counsel for the complainant sought to explain this part of testimony of CW1 by stating that this part of testimony relates to a previous loan transaction between the parties. To strengthen this line of defence, the complainant adverted the attention of this court to the testimony of CW1 in his examination in chief, where CW1 had stated that he had advanced a loan to the accused in view of the fact that the parties had previous financial dealings as well. In his examination in chief, CW1 has deposed that he had advanced a loan to the company accused after Santosh Kumar had reminded him that he is already aware of the previous conduct of the accused. The explanation of CW1 surrounding this part of the testimony appears to be more plausible, not merely in view of the fact that the accused had all along been taking a contradictory defence but also in view of the fact that the accused Pg. 28 of 36 C.C. No.11542/2019 chose to not draw out the complainant regarding any other particular of this repayment, to fully establish on the record that the repayment referred to was the repayment of the loan qua which the cheques in question were issued by the accused in favour of the complainant. Even if the explanation of complainant is to be disregarded, the benefit of this part of testimony of CW1 cannot be given to either of the parties.
23. To perforate the case of the complainant, the accused also tried to question the financial capacity of the complainant to advance the loan of Rs.6 Lacs to the accused. The accused could manage to elicit from the complainant/CW1 the testimony that CW1 had shown his yearly income to be only Rs.3 Lacs for the year 2012 2013 and 20132014. When questioned further regarding his capacity to advance the loan of Rs.6 Lacs to the accused, CW1 stated that he could advance the loan to the accused as he had received the sale proceeds of the ancestral property belonging to his grandmother, which was situated at Gali number 10, Lalita Park, Laxmi Nagar, Delhi. The complainant failed to bring on record the documents of the sale transaction, and also was inconsistent qua the amount of the sale consideration. The judgment of the Hon'ble High Court of Karnataka titled Veeraiah( supra) was relied upon by the accused to argue that mere issuance of a cheque itself is not sufficient to return of finding of conviction against accused, unless it is shown that the cheque was Pg. 29 of 36 C.C. No.11542/2019 issued towards the discharge of a legally recoverable debt. Reliance was also placed on the judgment of the Hon'ble Supreme Court of India in Basalingappa (supra), wherein it has been held that once the financial capacity of the complainant to advance a loan to the accused has been challenged, it was incumbent upon the complainant to explain his financial capacity, and where the accused is able to establish on a scale of preponderance of probabilities that the complainant did not have the requisite financial capacity to advance a loan to the accused, the evidentiary burden placed upon the accused by virtue of section 139 Negotiable Instruments Act can be said to be discharged. At the cost of reiteration, this line of defence taken by the accused is also not entirely appropriate in view of the defence taken by him that the said cheques came in possession of the complainant without his knowledge. The accused could have appropriately challenged the financial capacity of the complainant had it been his case that he had handed over the cheques in question to the complainant himself, but with respect to some other transaction or for repayment of a lesser loan amount than Rs.6 Lacs. Where the accused has taken the defence that the cheques came in possession of the complainant unknowingly to him, the challenge to the financial capacity of the complainant amounts to approbating and reprobating at the same time. Even otherwise, in the considered opinion of this court, the complainant has been able to sufficiently explain the financial capacity by stating that he could advance the loan to the accused out of the sale Pg. 30 of 36 C.C. No.11542/2019 proceeds received by him consequent to the sale of the ancestral property belonging to his grandmother. It is true that the complainant refused in his cross examination dated 21.01.2020 to bring on record the sale deed for the sale of this property. But this refusal has to be read in the context of this present case where the cross examination of CW1 commenced in 2016, and on the said date the complainant had said that he can bring on record the sale documents. In his crossexamination dated 21.01.2020 the complainant stated that he cannot bring the documents pertaining to the property of his grandmother on record as it was sold eight years ago. This explanation for not adducing the documents on the record does not appear to be entirely unreasonable. The complainant has any way stated on record the address of the property which was sold, and the explanation of the complainant regarding his financial capacity is not completely baseless.
Now at one place, in his crossexamination dated 11.08.2016, CW1 stated that the ancestral property of his grandmother was sold for approximately Rs.60 Lacs. However, in his crossexamination dated 18.09.2019, CW1 deposed that the said property was sold for approximately 1.2 Crores, and his mother received a share of 18 Lacs upon the sale of the property. The discrepancy in the testimony of the complainant/CW1 regarding the amount in which the property was sold is, although not insignificant, not as damaging to the case of the complainant so as to dispel or discredit the entire case of the complainant. CW1 has stated in his crossexamination that the sale proceeds of this ancestral Pg. 31 of 36 C.C. No.11542/2019 property were kept in cash in the bank locker by his mother and some balance was kept at home and while advancing the loan to the accused, he used approximately Rs.50,000 60,000 which was kept by him at home, and withdrew the rest of the amount from the bank locker of his mother, but does not remember the bank name where the locker was maintained or the locker number. CW1 further stated that he does not have good relations with his mother and cannot bring her on the stand or cannot enquire from her about the locker number. Now, CW1 could not have been expected to remember the locker number of his mother. The explanation afforded by him about the sale proceeds being in the locker appears to be a little thin, but it must be remembered here that the case under section 138 NI Act is premised on the theory of reverse onus of proof. The story offered by the complainant appears to be better knit than the defence taken by the accused. A few gaps here in there in the story of the complainant are not sufficient to discredit the entire case of the complainant. While the accused could manage to shake the credibility of the complainant a little, in so far as the complainant failed to adduce on record the sale deed pertaining to the sale transaction of the ancestral property and also gave two different versions about the total amount of the sale proceeds, this alone cannot help the case of the accused. One, the accused has stated all along that he never obtained a loan from the complainant and therefore, a more coherent line of defence for the accused would have been to establish on record, or at least place on record a plausible Pg. 32 of 36 C.C. No.11542/2019 explanation of how the cheques in question came in possession of the complainant in the first place. Challenging the financial capacity of the complainant to advance the loan to the accused would have been a helpful line of defence if it was the case of the accused that he had voluntarily given the cheques in question to the complainant, but for some other transaction than the one detailed on the record by the complainant himself. Since the accused has failed to give any explanation about how the cheques in question came in possession of the accused, challenge laid to the financial capacity of the complainant seems neither here nor there. Furthermore, great reliance has been placed by the accused on the fact that the complainant admitted the repayment of the loan of Rs.3 Lacs. On the one hand, the accused wants to take benefit of this admission of the complainant, which encompasses in itself the presumption that the complainant had the capacity to advance the loan to the accused and on the other, he has challenged the financial capacity of the complainant. So many contradictory stands are only successful in causing damage to the case of the accused himself. The reliance by the accused on the judgment of the Hon'ble Supreme Court of India in K Subramani (supra), wherein it has held that the fact that the complainant claimed to have advanced the loan consequent upon the sale of a property, but failed to produce the sale deed on record and also failed to adduce on record any document recording the loan transaction between him and the accused is a material circumstance, also does not help the case of the Pg. 33 of 36 C.C. No.11542/2019 accused for the same reasons.
24. Another lacuna that was pointed out by the accused in the case of the complainant is that there is no document recording the transaction of a loan advance by the complainant to the accused. This point was also raised during the stage of final arguments, when ld. counsel for the accused submitted before this court that the complainant had no occasion to advance a loan of an amount of Rs 6 lacs to the accused, with whom he was not very well acquainted, without ensuring due documentation of the transaction. To buttress this argument, ld. counsel for the accused placed reliance on the judgment of the Hon'ble High Court of Karnataka titled Veeraiah (supra), wherein the fact that the complainant in the said case did not take any document whatsoever neither a receipt nor a promissory note etc, from the accused before advancing him a loan of Rs.2 Lacs, was held to be one of the grounds entitling the accused to an acquittal. Similarly reliance was also placed upon the judgment titled Vijay versus Lakshman and others(supra). In the considered opinion of this Court, it was open for the accused to take this line of defence had he been able to explain how the cheques in question came in possession of the complainant in the first place. As held by the Hon'ble High Court of Delhi in the judgement titled VS Yadav versus Reena 2014 SCC OnLine Del 107, the complainant having a cheque in question in his favour, bearing the signatures of the accused, is a matter which cannot be taken Pg. 34 of 36 C.C. No.11542/2019 lightly. A cheque, being a negotiable instrument, has to be accorded due sanctity. Duly signed cheques of the accused being in possession of the complainant is a circumstance which corroborates the version of the complainant that the cheques were given to him by the accused in discharge of a legally enforceable liability. The accused, as has been elaborately discussed in the foregoing portions of this judgement, has failed to prove on record any reasonable explanation of how the cheques in question came in possession of the complainant herein. In the absence of any such plausible explanation, the presumption in favour of the complainant that the cheques in question were given to him by the accused in discharge of a legally enforceable debt cannot be lightly dispelled, for the absence of any documentary proof recording the loan transaction. The cheques in question, at the cost of reiteration, are in themselves sufficient record of the loan transaction. The legislative intent behind Section 138 NI Act is to accord greater sanctity to transactions intended to be carried out by way of cheques, and an escape route cannot be given to the accused, only on the basis of a bald assertion that no loan transaction existed between the parties as there is no document to evidence the same, when the accused has himself failed to offer even a plausible or probable explanation of the cheques coming into the possession of the complainant. Likewise, a few gaps in the case of the complainant such as the failure of the complainant to ensure that the property which the accused promised to transfer in his name in lieu of the loan amount was owned by the accused, or to ensure Pg. 35 of 36 C.C. No.11542/2019 execution of agreement to sell etc would have been relevant only if the accused could discharge the primary burden of proof placed upon him, which is not the case at hand, as is evident from the discussion in the preceding paragraphs. .
25. The complainant had argued that the document Mark D being the chargesheet sheet and documents annexed therewith arising out of FIR 113/14 contain the admissions of the accused and his wife of their liability towards the complainant, and are clinching of the issue at hand. Though these documents are relevant under the Indian Evidence Act, 1872, they are not admissible and cannot be looked into, since only photocopies of certified copies of the documents were brought on the record. Despite this, the fact remains that the complainant has the cheques in question in his favour, and the accused has not been able to sufficiently perforate the case of the complainant.
26. In view of the foregoing discussion, the accused Vishnu Prakash Dubey S/o Sh. Shambhu Nath is accordingly convicted for the offence punishable under Section 138 NI Act with respect to the cheques in question. Digitally signed by MEDHA
MEDHA ARYA
ARYA Date:
2021.10.22
14:16:52 +0530
Announced in open Court on (MEDHA ARYA)
21st day of October, 2021 M.M. (N.I. Act03), SouthWest,
(36 pages) Dwarka Courts, New Delhi
Pg. 36 of 36 C.C. No.11542/2019