Delhi District Court
Shriram Transport Finance Co. Ltd vs Vijay Chaudhary on 31 August, 2023
IN THE COURT OF SH. SNEHIL SHARMA, METROPOLITAN
MAGISTRATE, NI ACT DIGITAL COURT, NORTH EAST DISTRICT,
KARKARDOMA COURT, DELHI.
JUDGMENT
SHRIRAM TRANSPORT FINANCE CO. LTD. VS VIJAY CHAUDHARY CC NO: 288/22 P. S. Bhajan Pura U/s 138 NI Act a CNR No. of the case : DLNE020008242022 b Cheque number and dated : 830089 dt. 17.12.2021 c Date of institution of the case : 26.03.2022 d Name of the complainant : Sh. Tushar Chandra Mishra Power of attorney S/o Sh. Bhal Chandra Mishra Office Address: B-5, 1st Floor, Patel Nagar-IInd, above Ganga electronics Pvt . Ltd. Meerut Road, Ghaziabad, UP-201001 e Name of the accused and his : Vijay Chaudhary S/o Sh. Om Prakash Chaudhary parentage R/o H.No. 53, Village Roshanpur Salemabad, Patti Prata, Abupur, Devender General Store, Ghaziabad, UP-201206 f Offence complained of : 138 NI Act g Plea of accused : Not guilty h Orders reserved on : 24.07.2023 i Final order : Accused Vijay Chaudhary is Acquitted for the offences punishable under sections 138 NI Act.
j Date of judgment : 31.08.2023
1. Vide this judgment the present complaint case for an offence punishable U/S.138 of the Negotiable Instruments Act, 1881 (hereinafter "the NI Act") is being decided.
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2. It is case of the complainant is that the complainant is a company incorporated under the provision of the Companied Act, 1956 having its registered office at 14A-South Phase, Industrial Estate, Guindy, Chennai-600032 and branch office at B-5, 1st Floor, Patel nagar-Iind, above Ganga electronics Pvt. Ltd. Meerut Road, Ghaziabad, UP-201001 and present complaint is filed through its authorised represenative Mr. Tushar Chandra Mishra (Senior Credit Executive) who has been authorised by a special power of attorney dt. 12.01.22. The complainant company is engaged in the business of extending financial assistance in terms of loan for the purchase/refinance of motor vehicles, machinery and other assets.
3. The accused approached the complainant company for financial assistance in terms of vehicle loan and the complainant company after considering the request of the accused, sanctioned and disbursed the loan amount vide execution of loan cum Hypothecation Agreement bearing no. GHZBDT805190001 dt. 19.05.2018. The accused availed the loan finance amount of Rs.4,15,000/- as vehicle loan for purchase of a vehicle TATA SFC 407 bearing registration no. UP-12T-8006. The said loan amount of Rs.4,15,000/- alongwith the interest of Rs.2,95,891/- i.e. total agreement value/amount of Rs.7,10,891/- was to be paid by the accused in 58 monthly installments. However, the accused has deliberately breached the terms and conditions of the agreement and remain failed to adhere the financial discipline, while timely payment was the essence of the contract. The accused has been irregular in making estimated monthly installments and several cheques given towards the payment against his estimated monthly installments or outstanding liabilities got dishonoured on their presentation.
4. The accused in order to discharge his partial liabilities issued a cheque bearing no. 830089 dated 17.12.2021 of Rs.4,15,000/- drawn pon the South Indian Bank Ltd, Delhi Road, Meerut -250002 in favour of the complainant company. On the assurance of the accused, the complainant company presented the abovesaid cheque for encashment with his bank i.e. Axis Bank Ltd. but the said cheque was CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 2 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:22:19 +0530 dishonoured and returned unpaid with remarks "Funds Insufficient" vide return memo dated 07.01.2022. The complainant company immediately approached to the accused and informed him about the dishonour of the abovesaid cheque. The complainant company asked the accused to pay the cheque amount but the accused has straight way refused to pay the said cheque amount.
5. The complainant company through its counsel sent a statutory notice dated 20.01.2022 which was dispatched on 22.01.2022. The said legal notice was duly served upon the accused as per the postal tracking report and the notice/envelope has not received back to the complainant company. Despite the service of legal notice the accused has failed to make payment in lieu of the dishonoured cheque even after expiry of the statutory period of 15 days.
6. On being satisfied of the prima facie ingredients of Section 138 of the NI Act, cognizance was taken and summons were directed to be issued against the accused vide order dated 18.05.2022. As per mediation settlement the accused has failed to make the complete payment of settlement amount.
7. Accordingly, on 19.09.2022 notice under Section 251 Cr.PC r/w Section 263(g) Cr.P.C was framed and served upon the accused to which he pleaded not guilty and claimed trial. While putting forth his plea of defence, accused admitted his signatures upon the cheque in question and denied other particulars being filed by him. He had admitted that he had taken the vehicle loan of Rs.3,50,000/- from the complainant company in the year 2017. He had repaid around 50% of the loan amount to the complainant company. The vehicle is in the possession of the complainant company. The cheque in question alongwith three more cheques (blank and signed) were given to the complainant company as security at the time of taking loan from the complainant company. Complainant company asked the accused to surrender the vehicle and told him that after surrending the vehicle, he would not need to give any money to the complainant company and that is why he surrendered the vehicle to the complainant company. Complainant company had CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 3 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:22:24 +0530 misused his security cheque. He did not owe any liability towards the complainant company qua cheque in question.The statement of accused was recorded under section 294 Cr.P.C qua the admitted facts.
8. In Complainant's evidence, the complainant (CW-1) tendered his evidence affidavit in post summoning evidence (as the solitary witness) and relied upon the following documents:
i) Ex. CW-1/A : Evidence of complainant by way of affidavit.
ii) Ex. CW-1/2 : Original Cheque bearing no. 830089 dated 17.12.2021 of Rs.4,15,000/-(Four lacs Fifteen Thousand) issued by accused in favour of complainant drawn on The South Indian Bank, Delhi (fact of drawing the cheque is admitted by accused at the time of framing notice as well as his statement recorded Under Section 294 Cr.P.C)
iii) Ex. CW-1/3 : Original Cheque Return Memo dtd.
07.01.2022 (Admitted by accused at the time of his statement recorded Under Section 294 Cr.P.C)
iv) Ex. CW1/4 : Legal demand notice dt.
20.01.2022 sent by Complainant to accused through counsel (Admitted by accused in his statement recorded Under Section 294 Cr.P.C).
v) Postal receipt & Tracking report : Ex.CW1/5
& CW1/6.
vi) Statement of account : Ex.CW1/7
9. CW1 was cross examined on behalf of the accused. During cross examination, CW1 has stated that he has been working as recovery executive with the complainant company since 01.04.2009. The requirement for providing the loan by the company are Customer KYC, customer's own house or rented house, guarantor's own house etc. Source of income of the borrower is also taken into consideration. The loan advanced to accused was Rs.4,15,000/- for the period of 58 months. He did not know the rate of interest on which loan in question was given to accused. He did not know whether the EMI Schedule had been provided to CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 4 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:22:30 +0530 accused at the time of granting loan to him. He could not tell as to what was the EMI of the loan in question. He has voluntarily stated that he could tell the same after seeing the records. After seeing the record, CW1 has submitted that the EMI was of Rs.12,448/-, however the first EMI was of Rs.12,698/-. He did not know the income of accused at the time of sanctioning the loan in question. The loan in question had been sanction for TATA SFC, 407 but he could not recollect the vehicle number. He has further stated that vehicle in question was an old vehicle. He did not know the valuation of the vehicle at the time of sanctioning the loan. He did not know as to how many installments were paid by the accused, however, the same were in the statement Ex. CW1/7. The amount paid by the accused against the loan in question was mentioned in the loan account statement. After seeing the record, CW1 has submitted that the accused has paid an amount of Rs. 4,22,745/- against the vehicle loan in question till date. He had admitted that the present case has been filed for the cheque amount of Rs.4,15,000/-. He did not know the outstanding vehicle loan amount at the time of presenting the cheque in question. After going through the loan account statement, complainant/AR has submitted that the outstanding loan amount was Rs.4,35,000/-.
CW1 has admitted that the statement Ex. CW1/7 pertains to 8 loans taken by accused from the complainant company and there is only one vehicle loan which is the loan in question. He has further admitted that only three loans are pending against the accused including the loan in question. He has further admitted that only three loan are pending against the accused including the loan in question. He has admitted that the outstanding amount of Rs.4,35,000/- is for the loan amount including all pending loans against the accused. Questions were asked from the complainant that is it possible to advance eight loans to a person without knowing his source of income and he stated that one loan is parent loan i.e. loan in question, four loans are for insurance and remaining three are top up loan to clear the arrears of parent loan. CW1 has further stated that vehicle in question is sold by the complainant company now. He cannot tell as to when the vehicle in question of repossessed by the complainant company. Vehicle in question was sold by the complainant company for the amount of Rs.90,000/-. He did not even know the CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 5 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:22:36 +0530 year when the vehicle was sold. The vehicle was sold in the open auction. He could not comment that the insurance value of the vehicle in question was Rs. 3,81,195/- as on 05.09.2022 midnight. He has further stated that the accused never paid the regular EMI. Again question was asked from the complainant that is it possible that company shall advance further add on loans to the person who is not paying the EMIs of previous loan regularly and complainant submits that they helped the people in need and gave further loan as per previous track report and value of the accused was asked in market and he was given further loan on basis of that. He also voluntarily stated that accused also requested the same. CW1 did not know if any documents related to the financial capacity of accused was taken before granting the loan to the accused. He has voluntarily stated that loan department is different and it is taken by them. It is further stated that no written permission was obtained on consent was obtained from the accused at the time of selling his vehicle in auction. CW1 voluntarily stated that consent was obtained telephonically.
The Value of vehicle was managed on 04.02.2022 and 07.02.2022 of Rs.70,000/- and Rs.20,000/- respectively. He could not recollect the date of legal demand notice. He has admitted that the legal demand notice was sent to the accused on 20.01.2022. He has admitted that the legal demand notice does not finds mention about the sale of vehicle. He did not know the actual outstanding amount of vehicle loan in question. He did not know whether complainant is in possesson of four other blank signed cheques. He has further admitted that it is nowhere mentioned in the pleadings that complainant has sold the vehicle of the accused.
10. The accused was then examined under Section 313 Cr.PC, 1973 wherein all the incriminating evidence were put to the accused and he denied of having any liability towards the complainant as alleged. Accused opted to lead defence evidence. However, no defence witness is produced before the court. DE is closed. Accordingly, matter was listed for final arguments.
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11. It has been argued by Ld. Counsel for the complainant that case of the complainant is proved and cheque is also in the favour of the complainant, therefore, accused must be convicted and amount should be recovered. On the other hand, Ld. Counsel for accused has argued that accused has been falsely implicated in this case and that complainant has not been able to prove its case beyond reasonable doubt against the accused.
12. I have heard ld counsel for the complainant and Ld. Defence counsel for accused & considered the respective arguments as well as gone through case file very carefully.
13. Before discussing case in hand undersigned deems fit to discuss the legal principal governing criminal law. It is settled proposition of criminal law that prosecution is supposed to prove its case on judicial file beyond reasonable doubt by leading reliable, cogent and convincing evidence. Further, it is a settled proposition of criminal law that in order to prove its case on judicial file, prosecution is supposed to stand on its own legs and it cannot derive any benefit whatsoever from the weaknesses, if any, in the defence of the accused. Further, it is a settled proposition of criminal law that burden of proof of the version of the prosecution in a criminal trial throughout the case is on the prosecution and it never shifts to the accused. Also it is a settled proposition of criminal law that the accused is entitled to the benefit of every reasonable doubt in the prosecution story and such doubt entitles the accused to acquittal.
14. The essential ingredients in order to attract Sec. 138 of NI Act, 1881 are as following:
i) The cheque for an amount is issued by the drawer to the payee/complainant on a bank account being maintained by him.CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 7 of 17 Digitally signed
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ii) The said cheque is issued for the discharge, in whole or in part of any debt or liability.
iii) The cheque is returned by the bank unpaid on account of insufficient amount to honour the cheque or it exceeds the amount arranged to be paid from that account by an agreement made with the bank.
iv) The cheque is presented within 3 months from the date on which it is drawn or within the period of its validity.
v) within 30 days a legal demand notice is issued by the payee or the holder in due course to the drawer of the cheque on receipt of information by him from the bank regarding the dishonour of the cheque.
vi) The drawer of the said cheque fails to make payment of the said amount of the money as demanded in the legal demand notice to the payee or the holder in due course within 15 days of the reciept of said notice.
vii) The debt or other liability against which the cheque was issued is legally enforceable.
15. Now, coming to the facts of the present complaint case keeping in view the essential ingredients of section 138 of NI Act. In this case, it is not disputed and duly admitted by the accused that the cheque in question bears his signatures, however he denies the other particulars fulfilled by him but admits that the same was given to the complainant as a security cheque in lieu of the vehicle loan taken by him. Therefore, it can be said that the cheque was drawn by him in favour of the complainant. Therefore, the essential ingredient (i) as discussed in the preceding paragraph stands fulfilled. Accused has further admitted the fact of dishonour of the cheque in question, hence, another essential ingredients (iii) and (iv) also stand proved by the CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 8 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:22:52 +0530 complainant. Accused has further admitted the fact of receiving the legal demand notice sent to him by complainant during his statement recorded under section 294 Cr.P.C. Also as the accused has admitted that the address on legal notice is of him and postal receipts show that legal notice is duly served upon the given address which is of the accused. Therefore, presumption also draws against the accused that legal notice has been served. Also after accused appearing before the court and matter came in his knowledge and documents were supplied to him after summoning, still accused chose not to reply back the legal notice or to pay the due amount. Moreover, the address mentioned at legal notice is same as admitted in U/s. 313 CrP.C. , mentioned by the accused in his bail bond also show that legal demand notice were served at the given address. So it can be rightly said that he has received the legal notice. Hence, essential ingredients (v) and (vi) also stand proved.
16. In the landmark decision of Hon'ble Supreme Court of India in matter of "C. C. Alavi Haji Vs. Palapetty Mohd. & Anr." reported in (2007) 6 Supreme Court Cases 555 held that as under:-
"Any drawer who claims that he did not received the notice sent by post, can, within 15 days of receipt of summons from the court in respect of complaint Under Section 138 of the Act, make the payment of the cheque amount and submit to the court that he had made the payment within 15 days of the receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complainant is liable to be rejected. A person who does not pay within 15 days of receipt of summons from the court along-with the copy of complaint Under Section 138 of the Act, can not 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 G. C. Act and 114 of the Evidence Act."CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 9 of 17 Digitally signed by SNEHIL
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17. Now coming to the last and the remaining core ingredients (ii) and (vii) of Section 138 of NI Act as discussed above and the real issue of controversy herein i.e. whether the cheque in question was issued in discharge of any debt or liability, whole or in part and whether the same is a legally enforceable debt.
18. With respect to the point of blank cheque raised by the accused, it is pertinent to mention that Section 20 of the NI Act talks about inchoate instruments. As per this provision if a person gives a duly signed cheque which is either blank or partly filled then he is deemed to have given implied authority to the holder to fill up the particular in it and complete the cheque, thus making the draw liable for the payment mentioned in it. It is immaterial that the cheque may have been filled in by any person other than the drawer, when the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provision of section 138 would be attracted. At this stage, reference may be sought from the decision of Hon'ble Supreme Court in the case of Bir Singh vs. Mukesh Kumar (2019) 4 SCC 197 wherein the Apex Court while upholding the validity of blank signed cheque in a proceeding u/s 138 of the Act has interalia held the following:
"If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence."
19. In the present case, it is submitted by the accused as argument that the cheque was given for security purpose to the complainant and not in lieu of the loan amount and the complainant has misused the same by filing the CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 10 of 17 Digitally signed by SNEHIL SNEHIL SHARMA SHARMA Date:
2023.08.31 17:23:06 +0530 wrong amount because he has already repaid the loan amount and vehicle is also handed over to the complainant which was also having more value than the amount, if any left of the complainant.
20. It is a settled of the proposition of law that a cheque issued as security, pursuit of financial transaction, cannot be considered as a worthless piece of paper. It is given to ensure the fulfilment of an obligation undertaken. If a cheque issued to secure repayment of a loan advanced and if the loan is not repaid on or before the due date, the drawee would be entitled to get the cheque for payment, and if such a cheque is disordered, the consequences contemplated under section 138 NI act would follow. Reliance is placed upon Sripati Singh v. State of Jharkhand,2021 SCCOnline1002. Further as to the plea of cheque being a security cheque, it was held in ICDS v. Beena Shabir & Anr. (2002)6 SCC 426, that security cheques would also fall within the purview of section 138 NI Act and a person cannot escape is liability unless he proves that the debt or liability for which cheque was issued as security is satisfied otherwise.
21. In this case, the statutory presumptions under section 118(a) and 139 would be raised in favour of the complainant. Since, the accused has admitted the execution of impugned cheques and signatures on cheque in question, the aforementioned statutory presumptions would be raised in favour of the complainant regarding the fact that the impugned cheques have been drawn for consideration and issued by the accused in discharge of legally enforceable debt.
22. It has been held by a three-judge bench of the Hon'ble Apex Court in the case of Rangappa vs. Sri Mohan (2010) 11 SCC 441 that the presumption contemplated under Section 139 of NI Act includes the CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 11 of 17 Digitally signed SNEHIL by SNEHIL SHARMA SHARMA Date: 2023.08.31 17:23:14 +0530 presumption of existence of a legally enforceable debt. Once the presumption is raised, it is for the accused to rebut the same by establishing a probable defence. The principles pertaining to the presumptions and the onus of proof were recently summarized by the Hon'ble Apex Court in Basalingappa vs. Mudibasappa (2019) 5 SCC 418 as under:
"25. We having noticed the ratio laid down by this Court in the above cases on Section 118(a) and 139, we now summarize the principles enumerated by this Court in the following manner:
25.1. Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the discharge of any debt or other liability.
25.2. The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities. 25.3. To rebut the presumption, it is open for the accused to rely on evidence led by him or the accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
25.4. That it is not necessary for the accused to come in the witness box in support of his defence. Section 139 imposed an evidentiary burden and not a persuasive burden.
25.5. It is not necessary for the accused to come in the witness box to support his defence."
It is explicit in the NI Act that the said presumption shall remain untill contrary is proved.
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23. Here, in the cross examination of complainant, accused has brought to the notice of the court certain contradictions and ommissions made by the complainant. It is deposed by the complainant in his affidavit that the accused availed the loan of Rs. 4,15,000/- and he has repaid the amount of Rs. 4,22,745/- but complainant did not depose that how the accused is left with the liability of Rs.4,15,000/- that too in part and not whole. One more contradiction is brought by the accused in the cross examination of the complainant that CW1 after going through loan account statement Ex. CW1/7 submits that outstanding loan amount of the accused was Rs. 4,35,000/- but this court fails to understands that if for once we believe at the version of complainant then also it is not digestable that accused will pay the cheque of Rs. 4,15,000/- and not of Rs. 4,35,000/- i.e. he will keep Rs. 20,000/- with himself to be paid later on.
24. Accused has also asserted that complainant had hide various facts from the court and that is why the answers of the complainant are evasive and benefit should be given to the accused because in cross examination when the accused asked about rate of interest on loan to ascertain the remaining legal liability, the complainant depose that he did not know the rate of interest however it is mentioned in loan agreement. Perusal of the record shows that no loan agreement is placed on record by the complainant to ascertain liability of the accused. Complainant also deposed that he did not know whether EMI schedule has been provided to the accused. Complainant also deposed that he does not remember the vehicle number and he does not know how many installments were paid by the accused. Therefore, same is also raising doubts on the legal liability of the accused as deposed by the complainant.
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25. From the cross examination of the complainant it is also found that ex. CW1/7 pertains to 8 loan taken by the accused from the company for same vehicle and it is correctly admitted by the complainant that only three loans are pending against the accused including the present loan but these facts are not mentioned by the complainant in his evidence and complaint i.e. it can be said that complainant hide these facts from the court and did not come to court clean hands. Here it is impossible to ascertain the legal liability of the accused qua the different-different loans and which loan are pending and which are completely paid off out of eight loans.
26. In cross examination it is also deposed by complainant that the accused never paid regular EMIs but still complainant had given seven more top up/insurance loans to the accused to clear the parent loan. This court also fails to understand this version of the complainant as why one would provide more money to the accused if accused is not paying the previous EMIs regularly. This court also fails to understand that why the complainant did not approach the court earlier when the accused was defaulting the EMIs and keep on giving him money to file their case collectively after hiding these facts.
27. It is pertinent to note here that the accused has not disputed the transaction with the complainant rather he has disputed the amount as claimed by the complainant and as such complainant is also failed to clarify that when he himself has deposed during the cross examination that he does not know the outstanding vehicle loan amount then how he filed the case.
28. Moreover, it is deposed by the accused that he has given the cheque as security while taking of the vehicle loan and therefore, complainant also failed to prove that security cheque was given to discharge the burden of the all the eight loans because at the time of taking loans accused cannot be said CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 14 of 17 Digitally signed by SNEHIL SNEHIL SHARMA SHARMA Date:
2023.08.31 17:23:41 +0530 to be in position to know that he will take eight loans in future and his amount will be around Rs. 4,15,000/-. Moreover, the complainant no where deposed that he had taken back the possession of the vehicle and sold that the same for some amount. This fact is brought into knowledge of the court during cross examination when the complainant deposed that the vehicle in question was sold for Rs. 90,000/- while no comment is made by the complainant on the insurance value of the vehicle which was Rs. 3,81,195/-. Here no comment of the complainant is also giving benefit to the accused because if the insurance amount is wrong then the complainant should straight forwardly answer the question which is not the case here. These 90,000/- is also never adjusted by the complainant from the loan while the accused himself has submitted that he has already paid complete amount and surrendered the vehicle for remaining. Even the complainant could not prove that he took consent of the accused before selling the vehicle in meagre amount. In general, no sane person will give consent to sold vehicle way less than the market price. Therefore, it can be said that the accused has reversed the burden upon the complainant and the complainant has not discharged the same. Complainant cannot be given a benefit equal to have one's bread buttered on both sides (to have all five fingers in ghee).
29. The accused has been able to establish that there exists material contradictions and discrepancies in the version put forward by the complainant. The primary onus on the accused was to rebut the presumptions raised under Section 118(a) and section 139 of NI Act. The standard of proof required by the accused to discharge his burden is of preponderance of probabilities and he has successfully discharged his burden by punching holes in the version of the complainant. The Hon'ble Supreme Court in the case of M.S. Narayana Menon @ Mani v. State of Kerala (2006) 6 SCC 39 has observed as under, "32. A Division Bench of this Court in Bharat Barrel & CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 15 of 17 Digitally signed by SNEHIL SNEHIL SHARMA SHARMA Date:
2023.08.31 17:23:53 +0530 Drum Manufacturing Company v. Amin Chand Payrelal [(1999) 3 SCC 35] albeit in a civil case laid down the law in the following terms:
"Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non- existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies."
30. Now, that the onus has shifted to the complainant to prove that he had liability alleged pending from the accused and accused had given the cheque in lieu of the said liability. However, no further evidence and explanation has been led by the complainant.
31. Section 101 of Indian Evidence Act clearly states that who ever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist. When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person. One who asserts a particular fact is in existence, then he has to prove the said fact unless and untill the law says that the burden lies anymore else.
32. As observed by the Supreme Court in State of Rajasthan v. Kalki (1981) 2 SCC 752) normal discrepancies in evidence are those which are due to normal errors of observation, normal errors of memory due to lapse of time, due to mental disposition such as shock and horror at the time of CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 16 of 17 Digitally signed by SNEHIL SNEHIL SHARMA SHARMA Date:
2023.08.31 17:24:14 +0530 occurrence and those are always there however honest and truthful a witness be. Material discrepancies are those which are not normal and not expected of a normal person. Courts have to label the category to which a discrepancy may be categorized. While normal discrepancies do not corrode the credibility of a party;s case, material discrepancies do so.
33. Hence, in the light of discussions and the authorities cited in the aforegoing para(s), it is apparent that the case of the complainant that the cheque in question was issued by the accused for the purpose repaying the loan amount advanced by the former to the latter is unworthy of credit and fails to inspire the confidence of the court and is full of clouds. The accused has rebutted the presumption raised under section 139 of NI Act. Consequently, it can be said that no legal liability exists in favour of the complainant, thus, the second ingredient to the offence under section 138 of NI Act does not stands proved.
34. In my view, the complainant has failed to prove that the accused had issued the cheque in question in his favour for discharge of the legally enforceable liability under Sec. 138 Negotiable Instruments Act. Resultantly, the accused VIJAY CHAUDHARY stands acquitted for the said offence.
Digitally signed by SNEHIL SNEHIL SHARMA SHARMA Date: 2023.08.31 17:24:27 +0530 Announced in Open Court (SNEHIL SHARMA) today on 31.08.2023 MM (NI Act) Digital Court, NORTH EAST,KARKARDOOMA CC NO. 288/22 Shriram Transport Finance vs Vijay Chaudhary Page 17 of 17