Delhi District Court
M/S Bhagwanti Trading Company vs Jarnail Singh Cc No. 593/2010 on 10 August, 2011
IN THE COURT OF SH. RAKESH KUMAR SINGH:
METROPOLITAN MEGISTRATE (NI ACT)-1, CENTRAL:
ROOM NO.-42, TIS HAZARI COURT COMPLEX, DELHI
10.08.2011
M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010
JUDGMENT U/S 264 Cr.PC.
Complainant has claimed the following events:
Madhu Gupta is the Proprietor of the Complainant firm and has authorized Brij Gupta to file this
complaint. The cheques were issued and revalidated by the accused to discharge the balance payment of Rs.
2,69,167/-. All the three cheques were dishonoured due to funds insufficient. The first cheque was dated
01.07.2007 revalidated for 15.07.2009. The second cheque was dated 10.12.2007 revalidated for 16.07.2009.
The third cheque was dated 03.12.2007 revalidated for 17.07.2009.
Accused has claimed the following events:
The cheques were issued to the complainant in advance as collateral security for supply of goods.
However, the payments of these cheques were already made to the complainant. The said cheques were never
returned by the complainant despite the demand. In the year 2009, accused had not given any cheque to the
complainant. Accused never revalidated the cheques. The signature and revalidated dates appearing on the
cheques do not pertain to the accused.
Discussion:
To establish the defence of non-revalidation of the cheques, accused has examined one handwriting
expert in his defence who has stated in his opinion that the signatures appearing on the cheques at original
points and at revalidated points are not of the same person and the revalidated dates are also not written by
the same person. He has written his opinion on the basis of following:
1. Difference in movements of hand.
2. Variations with regard to size, curvature, angle and spacing.
3. Difference in development of writing, freedom, fluency and continuity in the motion of pen with
fundamental differences.
4. Difference in writing speed and finger movements viz-a-viz wrist movement.
5. Difference in formation of letters, digits and through stops, through design, way and place of joining
the strokes.
M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010 1
Handwriting Expert also observed some similarity in respect of descending alignment and
executional mode of letters and digits. However, on this score he opined that the same way due to forgery as
the forger took the admitted signatures as model signatures.
In the cross-examination, the testimony of Handwriting Expert has remained intact.
The testimony of accused has also remained intact in the cross-examination and the complainant
failed to impeach the version of the accused. Other necessary ingredients such as dishonour of cheques and
legal demand notice are not disputed. What has been disputed by the accused is that he never revalidated the
cheques and this payment in respect of the cheques were already made earlier. On both the coutns testimony
of the accused has remained intact. However, AR of the complainant has not been cross-examined since
accusd has not recalled the complainant for cross-examination U/s 145(2) NI Act and, therefore, statement of
the AR of the complainant given in the affidavit has also to be given due weightage. AR of the complainant,
however, has stated in his affidavit that as per the balance sheet ending on 31.03.2009, payment was
outstanding. If we corelate this to the averments in complaint, we find that the balance outstanding on
31.03.2009 was Rs.2,69,167/-.
Complainant has not brought on record any balance sheet to establish such outstanding amount.
However, the accused has also not brought on record anything establishing the factum of repayment of the
dues which according to the accused was already paid before 2009.
In such circumstances, the only thing has to be considered is the scope of mandatory presumptions of
law. But as said, apart from being rebuttable, the presumptions of law can only come into picture when all the
founding facts thereof are established. One such founding facts may be that the cheque was issued.
In the present case, the issuance of the cheques is itslef in controversy. If revalidation is not
established, the cheque will become void.
So far as the revalidation is concerned, AR of the complainant has not brought anything except his
own affidavit to establish the revalidation. As against this, the accused has examined a Handwriting Expert
who has given his opinion that the signature and date of revalidation do not pertain to the accused (discussed
earlier).
In such circumstances, version of accused is to be believed viz-a-viz version of the complainant.
Once it is established that the revalidation was not done by the drawer, the concept of material
alteration envisaged U/s 87 NI Act has to come into play. (mentioning of date on a blank cheque may be
M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010 2
permissible under Section-20 NI Act but the change of date after expiry cannot be so permissible). On the
basis of such cheques, no cause of action can be created.
Issue of properitorship:
Ld. Counsel for the accused has also raised a contention that the AR of the complainant has failed to
establish any connection between the payee i.e. Bhagwati Trading Company and the person who has
authorized him i.e. the so called proprietor. He has relied upon Milind Shripad Chandurkar vs Kalim M.Khan
& Anr. 2011 Cri L J 1912 SC.
Brij Gupta has claimed himself to be the authorized representative of the proprietor of the Payee of
the instant cheque i.e. Bhagwati Trading Company. However, he has not brought on record anything
establishing the connection of Mrs. Madhu Gupta with the Payee i.e. Bhagwati Trading Company. A mere
statement in the affidavit, in my considered opinion, is not sufficient to grant him a right to make a complaint
on behalf of the Payee.
After having dealt with the judgments titled Shankar Finance and Investments v. State of Andhra
Pradesh & Ors., (2008) 8 SCC 536, Janki Vashdeo Bhojwani v. Indusind Bank Ltd.,(2005) 2 SCC 217,
National small Industries Corporation Ltd. v. State (NCT of Delhi) & Ors., (2009) 1 SCC 407, Hon'ble
Supreme Court in Milind Shripad Chandurkar vs Kalim M.Khan & Anr. 2011 Cri L J 1912 SC has
observed and held as under:
"9. The only issue involved herein is as to whether the appellant owns the said firm
i.e., whether he is the proprietor of the said firm? The trial Court as well as the
Appellate Court have held that a sole proprietary concern is no independent legal
entity and its identity remains inseparable from its proprietor. But it merely remains a
legal proposition. None of the said courts held that the appellant was the sole
proprietor of the said firm.
22. Thus, in view of the above, the law stands crystallised to the effect that a person
can maintain a complaint provided he is either a "payee" or "holder in due course" of
the cheque.
23. In the instant case, it is evident that the firm, namely, Vijaya Automobiles, has
been the payee and that the appellant cannot claim to be the payee of the cheque, nor
can he be the holder in due course, unless he establishes that the cheques had been
issued to him or in his favour or that he is the sole proprietor of the concern and being
so, he could also be payee himself and thus, entitled to make the complaint. The
appellant miserably failed to prove any nexus or connection by adducing any
evidence, whatsoever, worth the name with the said firm, namely, Vijaya
M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010 3
Automobiles. Mere statement in the affidavit in this regard, is not sufficient to meet
the requirement of law. The appellant failed to produce any documentary evidence to
connect himself with the said firm. It is evident that the firm had a substantial amount
of business as in one month it sold the diesel to respondent no. 1 - a single party, for a
sum of Rs. 7 lakhs. The appellant would, in addition, have also been carrying out business with other persons. Thus, a person with such a big business must have had transactions with the bank and must have been a payee of income tax, sales tax etc. Thus, in such a fact-situation, there would be no dearth of material which could have been produced by the appellant to show that he was the sole proprietor of the said firm. The appellant failed to adduce any evidence in this regard, nor made any attempt to adduce any additional evidence at the appellate stage, in spite of the fact that the respondent is raising this issue from the initiation of the proceedings."
In the instant case, the complainant is also claiming himself to be the representative of sole proprietor of the firm, however he has not tried to adduce any evidence to establish the connection between the principal who authorized him and the payee i.e. proprietorship firm. The cheque in question is in the name of Bhagwati Trading Company and not in the name of individual complainant. The question posed before and answer given by the Hon'ble Suprme Court in the above noted case does squarely apply to the instant case.
In such circumstances, it has to be held that Brij Gupta failed to establish any connection with the payee i.e. Bhagwati Trading Company and therefore this complaint has to fail.
Viewed from any angle, the complaint can not succeed on any count.
Result:
A finding of not guilty is thereofore returned. Accused is acquitted from the charges in the present complaint case.
A copy of this order be placed on the official website of the District Court.
(Rakesh Kumar Singh) MM(NI Act)-01, Central/10.08.2011 M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010 4 IN THE COURT OF SH. RAKESH KUMAR SINGH:
METROPOLITAN MEGISTRATE (NI ACT)-1, CENTRAL:
ROOM NO.-42, TIS HAZARI COURT COMPLEX, DELHI Record u/s- 263 Cr.PC.
a. The serial No. of the case
593/2010
b. The date of the commission of the offence
21.07.2009
c. The date of the report or complaint
24.09.2009
d. The name of the complainant (if any)
Bhagwanti Trading Company
e. The name, parentage and residence of the accused
Jarnail Singh, S/o Sohan Singh, R/o 154 Jagriti Enclave, Delhi-92. f. The offence complained of or the offence (if any) proved Dishonor of cheque for 'funds insufficient' punishable u/s-138 NI Act. g. Plea of the accused and his examination (if any) Not guilty. Cheque given to the complainant as a collateral security. Time barred complaint. Material alteration in the cheques. No revalidation of the cheques. No liability.
h. The finding
Held not guilty.
i. The sentence or other final order
Acquitted.
j. The date on which proceedings terminated
10.08.2011
M/s Bhagwanti Trading Company vs Jarnail Singh CC No. 593/2010 5