Delhi District Court
" In The Instant Case vs . on 28 July, 2012
IN THE COURT OF SH. BABRU BHAN, METROPOLITAN MAGISTRATE,
(SPL. NI COURT 14) DWARKA COURT, NEW DELHI
M/s Abhilasha CoOperative Urban Thrift & Credit Society Ltd.
Vs.
Vijay Kumar
C.C. No. 1013/12/07
P.S.: Adarsh Nagar U/s 138 N.I. Act
JUDGEMENT
a) Date of commission of offence: 06.12.2007
b) Name of Complainant M/s Abhilasha CoOperative Urban Thrift
& Credit Society Ltd. through Authorized
Representative Sh. Parveeen Kumar
Sharma
c) Name of the accused and Address: Vijay Kumar, S/OSh. Shyam Lal,
R/O13/335, Gali No. 13, BBlock, Brij Puri,
Delhi
d) Offence complained of: U/s 138 N.I. Act
e) Plea of accused: Pleaded not guilty
f) Final order: Acquitted
g) Date of order: 28.07.2012
h) Date of institution of case: 11.12.2007
i) Date of decision of case: 28.07.2012
CC No. 1013/12/07
M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 1 of 25 B rief facts and reasons for decision of the case:
1. The present complainant has been filed by M/s Abhilasha CoOperative Urban Thrift & Credit Society Ltd through its Authorized Representative Sh. Parveen Kumar Sharma against the accused Sh. Vijay Kumar S/o Sh. Shyam Lal for the offence U/s 138 Negotiable Instrument Act, 1881 (hereinafter referred as N.I. Act, as amended upto date).
2. At the outset, case of the complainant, in brief, may be noticed. According to the complainant, they had granted a loan facility for the sum of Rs. 40,000/ to the accused on 8.04.12. As per the agreed schedule, the loan amount was to be repaid in 25 equal monthly installments along with interest @ 16 % p.a. Accused in discharge of his legal liability issued a cheque bearing numbers 178842 amounting to Rs. 46,000/ dated 16.10.2007 drawn on State Bank of Patiala, Azadpur, Subzi Mandi 27, Transport Center, New Delhi in favour of the complainant. However, on presentation , the cheque was dishonoured vide cheque returning memo dated 18.10.2007 on the ground of "Insufficient Funds". The complainant has thereafter given a legal notice of demand CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar
2 of 25 dated 29.10.2007 to the accused which was sent by speed post thereby calling upon the accused to make the payment of cheque amount. It is alleged that the accused failed to make the payment in response to the legal demand notice within statutory period and thereby has committed the offence u/s 138 N.I. Act.
3. Authorized Representative of the complainant appeared as CW1 and led the pre summoning evidence by way of an affidavit. Counsel for the complainant was heard, documents and material filed on record was considered on the point of summoning. Thereafter, summons were issued against the accused vide order dated 29.03.2010 for offence u/s 138 N.I. Act 1881. On appearance of accused a separate notice u/s 251 Cr.P.C. r/w Section 138 N.I. Act dated 29.03.2010 was served upon the accused to which he pleaded not guilty and claimed trial.
Complainant Evidence:
4. During the trial, the complainant examined only one witness i.e. CW1, Sh. Parveen Kumar Sharma, Authorized Representative of the complainant society. The CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 3 of 25 Evidence of Mr. Parveen Kumar Sharma, CW1 was filed in post summoning evidence by way of affidavit which is Ex. CW1/P. The other documents relied upon by the complainant are, the copy of Authority Letter in favour of AR, Ex. CW1/1, the original cheque, Ex. CW1/B, the intimation regarding dishonor of impugned cheque, Ex. CW1/C, legal notice of demand, Ex. CW1/D , the postal receipts of said notice are Ex. CW1/E to CW1/H. Subsequently, additional evidence was filed by way of another affidavit by CW1, same is Ex CW1/Z along with copy of payment voucher Ex CW1/1, copy of loan application and bond EX CW1/2 and 3, copy of arbitration award Ex CW1/4.
5. In his cross examination CW1, Sh. Parveen Kumar Sharma stated that the loan was disbursed to the accused by way of cheque and no filing charges were deducted from the loan amount. CW1 further deposed that the accused had not paid even single EMI. CW1 stated that he did not know that whether on 16.04.2007 cheque no. 178841 for and amount of Rs. 6765 and on 17.04.2007 cheque no. 178845 for an amount of Rs. 30,000/ were given by the accused to the complainant society or not. CW1 stated that CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 4 of 25 accused had made the payment of Rs. 5100/ and Rs. 2110/ on 08.04.2007 and 22.11.2006 respectively in account no. 280 of the complainant society. CW1 volunteered that the amount of Rs. 2110 was paid by the accused as membership fee and amount of Rs. 5100 was deposited towards share money, compulsory deposit and contribution towards society funds. CW1 also stated that the complainant sent a notice to the accused after default of three EMIs. CW1 further deposed that he did not know about the outstanding liability of the accused on the date of said notice. CW1 denied the the suggestion that no such notice was sent to the accused. CW1 further denied the suggestion that the accused had issued five cheques to the complainant society numbering from 178841 to 178845. CW1 further stated that he did not know that the cheque no. 178841 and 178845 cleared on 16.04.2007 and 17.04.2007. CW1 also denied the suggestion that the cheque in question was given on 16.04.2007. CW1 also denied the suggestion that the impugned cheque was given for the security purpose. Thereafter, on the statement of Ld counsel for the complainant, the complainant evidence was closed.
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 5 of 25 Statement of accused:
6. The complainant evidence was followed by the statement of accused u/s 313 wherein, all the incriminating evidence against the accused was put to him. In his statement, accused admitted issuance of impugned cheque but stated that he gave five cheques to the complainant and the impugned cheque is one of those five cheques. Accused further stated that the said cheques were given as blank signed. He denied the service of legal notice of demand. During the recording of his statement, he expressed his willingness to lead Defence evidence.
7. In defence, accused examined himself as DW1 u/s 315 Cr.P.C. In his statement he admitted the signature on document Ex. CW1/1 vide which the loan of Rs. 40000/ was received. He further deposed that he had issued a cheque bearing no. 178841 for the amount of Rs. 6765 to the AR for the complainat. DW1 further stated that he had also issued a cheque bearing no. 178845 dated 17.04.2007 for the amount of Rs. 30000/ to the same person and now reminded his name as Parveen Sharma. DW1 stated that he did not have any document to prove the payment of Rs. 30000/ . DW1 also stated that his three more cheques bearing no. 178842, 178843 and 178844 were in CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 6 of 25 possession of the complainant company. The documents relied upon by the accused in defence are Ex. DW1/1 and DW1/2, the other documents filed by the accused are Mark 'A' to ' F'.
Arguments:
8. Ld. Counsel for the complainant as well as for the accused assisted the court by addressing useful and pertinent arguments. Before proceeding further it is necessary to look into the necessary ingredients of offence U/s 138 N.I. Act, the same are as under :
i) There is a legally enforceable debt;
ii) That the cheque was drawn from the account of bank for discharge in whole or in part of any debt or other liability.
iii) that the cheque so issued had been returned due to insufficiency of funds. The proviso appended to this section provides for the compliance of legal requirements before a complainant petition can be acted upon by a court of law. CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 7 of 25
9. I would now embark upon the evidences adduced and the arguments advanced by both the parties. It is contended on behalf of the complainant that accused had availed a loan facility in sum of Rs. 40000/ at the interest rate of 16% p.a. from the complainant on 08.04.2007. The loan amount was to be repaid in 25 monthly installments. It is further averred that accused failed to make the payment of even a single installment therefore the complaint again approached the accused and requested the accused to make the payment of the entire loan amount along with the interest. It is alleged that in pursuance of the request, accused issued the impugned cheque bearing no. 178842 dated 16.10.2007 for a total sum of Rs. 46000/. On presentation of the same, it was dishonoured, legal demand notice was sent and despite service of notice, accused failed to make the payment till the date of filing the present complaint. Ld counsel for the complainant submitted that the loan liability and issuance of cheque has been admitted by the accused. Further, accused failed to bring any evidence in support of his defence that he had repaid the entire loan amount before the date of issuance of cheque and the cheque in question was given blank signed for the purpose of security and the same was misappropriated by the complainant.
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 8 of 25
10. Per contra, Ld counsel for the accused submitted that the accused had issued the cheque in question at the time of loan agreement along with five other blank signed cheques. The cheque in question was given for the purpose of security which was subsequently filled up and misappropriated by the complainant. It is also submitted by the Ld. defence counsel that the accused that accused has already repaid the loan amount and he was not liable to pay cheque amount on the date of issuance of cheque. Document relied upon by the accused in support of payment is Ex. DW1/2, this document is photocopy of bank pass book and as per the entry dated 17.04.2007, amount of Rs. 30000/ was withdrawn from his account by way of a cheque no. 178845. It is contended that the said amount was credited in favour of the complainant.
11. I have perused the evidence on record and considered the submissions of both the Ld. Counsels. The complainant witness has stated in his affidavit that the accused had availed the loan facility in the sum of Rs. 40000/ from the complainant . This fact is not entirely disputed by the accused but he stated in his cross examination that he is not liable to pay the amount of the cheque and infact the cheque in question was issued blank as security at the time of loan agreement. Whereas the complainant has stated in CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 9 of 25 affidavit that the cheque in question was issued in discharge of liability arising out of the loan agreement. It is stated by the complainant witness in his affidavit that accused failed to make the payment of even a single loan installment. After the accused made the default in making the payment of six consecutive EMIs then the complainant issued a notice to the accused and after the persuasion and request the cheque in question was issue on 16.04.2007.
12. One of the main ingredient of the offence under section 138 N.I. Act is existence of legally enforceable debt or liability. It is expressly clear from the bare reading of section 138 N.I. Act that to attract the criminal liability under this section, existence of legally enforceable debt or liability is condition precedent.
13. At this stage, it is necessary to refer to the provisions of section 118 and section 139 of N.I. Act. Under section 118, unless the contrary is proved , it is to be presumed that the Negotiable Instrument had been made or drawn in discharge of legal debt or liability. Under Section 139 the court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part of CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 10 of 25 debt or liability. Thus, in complaints under section 138 the court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable.
14. Undoubtedly, there is a presumption that whenever a negotiable instrument is drawn or made unless the contrary is proved it have to be presumed that same was drawn for the consideration. But important thing is that whether production of a cheque by the holder and admission of the signature on the same by the drawer is sufficient to held the holder criminally liable for the dishonour of the same . Merely stating in the complainant and the affidavit that cheque in question was given for the repayment of the loan will not advance the cause of the complainant. It is pertinent to mention here that complainant witness has deposed in his cross examination that when the accused defaulted in payment of EMIs, a notice was sent to the accused and as a result of persuasion and request,the impugned cheque was issued by the accused. On the other hand, it is contended by the Ld counsel for the accused that the impugned cheque was issued at the time of loan agreement and the accused has already made the payment of entire loan amount, thus accused was not liable to pay anything to the complainant on the date of impugned cheque. At this juncture it is necessary to refer to that part of CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 11 of 25 cross examination of CW1, where he has stated that he did not remember that how much amount was outstanding against the accused on the date of issuance of impugned cheque. This part of testimony of CW1 clarifies that complainant witness is not clear and aware about that what was the outstanding liability of the accused when the cheque in question was issued and how much amount he had already paid before the cheque in question was allegedly issued.
15. Accused has admitted that he had availed a loan facility in sum of Rs. 40000/ from the complainant society and has also repaid the same before the cheque in question was issued. So, the defence of the accused is that although he had availed the loan facility from the complainant but he had already repaid the the entire amount to them. Accused has also placed on record the copy of his bank pass book Ex. DW1/2 as per which the amount of Rs. 30000/ was withdrawn from his account vide cheque no. 178845 on 17.04.2007 and it is alleged that same was paid to the complainant. Moreover, the complainant witness has stated in his cross examination that he did not remember that on 16.04.2007 a cheque bearing no. 178841 for a sum of Rs. 6765/ and on 17.04.2007 cheque no. 178845 for sum of Rs. 30,000/ were given by the accused to CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 12 of 25 the complainant society. CW1 also failed to answer that whether the above cheques were cleared or not. Further, CW1 failed to tell exact outstanding against the accused on the date of cheque. In such circumstances, burden shifted upon the complainant to prove the liability of the accused on the date of the cheque by placing on record the statement of account and other books of record which are maintained by the complaint society because a doubt was raised by the accused on his outstanding liability and the complainant witness failed to clarify the same.
16. Undoubtedly, it is true that for prosecution under section 138 of N.I. Act, complainant is not obliged to prove the original transaction or the original consideration as it is expected in a suit for recovery of money but when execution of the cheque and debt or liability is disputed by the accused then it becomes the duty of the complainant to prove the liability of the accused by placing on record the relevant documents i.e. Statement of account or other record books. Even if we assume that since it is not a civil suit therefore there is no need to file any loan documents in view of the presumption under section 139 of N.I. Act still complainant could have filed statement of account of the accused which could evince as to what was the amount of installment, how many CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 13 of 25 installments have been paid by the accused and how much amount is outstanding against him. Since complainant is a cooperative society and must be maintaining its books of account therefore it was incumbent upon it to have filed its books of account in support of its claim. To further bolster my observation, I would like to refer to a judgment in Murugan Financiers V. P. V, Perumal, 2006 Cr LJ 269(Mad) wherein the order acquitting the accused was upheld on the finding that since the complainant being a finance company has not produced books of account in support of claim, complaint has not proved debt or legally enforceable liability satisfactorily. In the present case also complainant has failed to bring any document on record to prove the outstanding liability of the accused and the testimony of the CW 1 was also very vague and ambiguous. CW1 failed to answer any question about the outstanding liabilitiy and installment paid by accused till date of cheque, in such circumstances it was indispensable to file the books of account to prove the liability of accused.
17. Also in case of M. Vairavan v. T.M Selvaraj Crl A No. 352 of 2009, Madras High Court. The relevant portion of the judgment is reproduced here as under :
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 14 of 25 " in the instant case, the appellant/complainant is only an individual, therefore, it cannot be said that non production of his account books would affect the case under section 138 of N.I. Act, though the same is relevant in a case relating to financial companies and other institutions having books of account. The decision of this court in Murugan Financiers Vs, P.V. Perumal reported in 2005 Crl L.J. 269 ended in acquittal on account of the non producation of books of accounts, sought for by the accused therein has no relevancy in this case. "
18. So, it is clear from the above judgment that the complainant being the cooperative society maintaining the record of every borrower and frequently enter into such loan transactions ought to have produced the accounts books and the statement of account of the accused in order to prove his outstanding liability. When the complainant witness was asked about the installments paid by the accused and his outstanding CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 15 of 25 liability on the date of the issuance of cheque, he failed to give any satisfactory answer. During his cross examination When CW1 deposed that he was not aware about the total outstanding liability and the clearance of cheques given by the accused to the complainant. Specific questions were asked and the liability was disputed, so, the complainant was suppose to prove these fact by placing on record the relevant documents. As the same was not produced, I am inclined to arrive at a finding that complainant has not establish the outstanding liability of the accused to the tune of cheque amount on the relevant date.
19. In M.S. Narayana Menon Vs. State of Kerla and Others 2006 SCC 39, it has been held by Apex Court that : ".................If the defence is accepted as probable the cheque therefore cannot be held to have been issued in discharge of the debt as for example, if a cheque is issued for security or for any other purpose the same would not come within the purview of section 138 of N.I. Act. "
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 16 of 25
20. In support of my view, I would further refer to the judgment of the Bombay High Court in Rama Krishnan Urban Cooperative Society Ltd. Vs. Sh. Rajender Bhagchand Warma, Criminal application no. 898/2009. The pertinent question which was discussed in this case was when a blank cheque is given as security, whether the provisions of 138 will be applicable or not. The court considered the entire issue and held as under : " It is argued that the cheque drawn must be for the discharge, in whole or in part, of any debt or other liability. So the debt or other liability must be in existence when the cheque, whether blank or post dated was issued. In this case the accused respondent issued the cheque in question as security for loan before loan amount was disbursed. So, cheque was not towards any existing debt or liability. In case of loan transaction, borrower is in need of money and therefore he borrows loan amount from some one with understanding that the loan amount would be repaid in lump sum on a future CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 17 of 25 date or in installments from particular future date onwards periodically, with or without interest. It is not transaction of loan, if the amount is to be repaid the moment it is paid to borrower. So, provisions of Section 138 of the Negotiable Instrument Act are not attracted. "
21. We may consider object and purpose for introducing amendment to the Negotiable Instrument Act, 1981 by Amendment Act, 1988 as stated in the Amendment Act and various authorities to facilitate correct interpretation of the provisions. The object and reasons clause of the bill which introduced the Amending Act of 1988 would show that the new Chapter XVII was incorporated specifically to " enhance the acceptability of cheques in settlement of liabilities by making the drawer liable for penalties in case of bouncing of cheques due to insufficiency of funds in the accounts or for the reason that it exceeds the arrangements made by the drawer, with adequate safeguards to prevent harassment of honest drawers.
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 18 of 25
22. Thus, the object of the amendment and introduction of Chapter XVII in the Negotiable Instrument Act by Act of 1988 was mainly to encourage all major transactions including commercial or business transactions through cheques and to enforce credibility and acceptability of cheques in settlement of liability in general. Encouragement of payment by cheques/credit cards/debit cards rather than by cash is necessary for healthy economy. That also brings in transparency in transactions and discourages creation of black or unaccounted money through evasion of taxes or other malpractices. So, provisions like Section 138 of N.I. Act are salutary to give reliability, credibility and acceptability of negotiable instruments like cheques in daily life. However, the object was not to provide effective and speedy remedy for recovery of loans. Law makers must not have intended or imagined that money lenders or banks would obtain blank or post dated cheques while sanctioning/disbursing loans as securities and would use them to make debtors/borrowers to repay loan under threat of prosecution and punishment under section 138 of the N.I. Act. So, it is doubtful if provisions of Section 138 of the N.I. Act would be attracted to a case in which a blank or post dated cheque is obtained by a bank or money lender before or while sanctioning or disbursing loan amount as security for the loan. There was no supporting evidence from the side of the complainant as to whether the accounts had been verified. No CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 19 of 25 accounts had been produced by the appellant to prove that liability was subsisting. Only when it is proved that a liability was existing, an offence under Sec. 138 will arise.
23. I would like to refer one more judgment by Hon'ble Delhi Court. In Pine Products Industries V, M/s R.P. Gupta and Sons, 2007 (2) C.C. Cases H.C. 166 it was held that when accused pleaded that his cheque was misused and he is not liable to pay the amount covered in the cheque then keeping in view the fact that complainant had not given any details what were the liabilities of the accused, what was the amount for which cheque was issued as a part payment, on which date and what amount was given to the accused at what rate, therefore, presumption of liability has been rebutted by the accused so he is liable to be acquitted.
24. In the same manner, in the present case the accused had pleaded the misuse of cheque which was given blank signed for the security purpose and has disputed the liability to the tune of 46,000/ on the date of cheque. Accused has also stated that he had paid Entire loan amount before the cheque in question. As the accused is devoid of any details of his outstanding liability and installments paid by him before the date of CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 20 of 25 the impugned cheque, further no statement of account showing his liability to the tune of Rs 46,000/ and CW1 also failed to answer the relevant questions about his outstanding liability during his cross examination, therefore in my opinion the defence of the accused seems to be probable.
25. Accused has stated during his examination and also at the time of recording of statement u/s 313 Cr.P.C that the cheque was issued blank i.e. it bears his signature only and body of the cheque has not been filled by him. It is true that when the cheque in question contained the signature of the account holder, it is for the accused to explain the same, but merely because cheque contained the signature of the account holder or the accused it can not be said that the same was executed by him. In the present case, it is relevant to note that the case advanced by the accused is that the cheque in question was entrusted with the complainant and the cheque contained nothing more than her signature. Going by Section 138 of the N.I. Act, it can be seen that a drawing of cheque by a person on an account maintained by him with the banker for payment of any amount of money to another person from out of that account 'for the discharge', in whole or in part, of any debt or other liability are two important ingredients, especially CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 21 of 25 in the background of this case. In the decision reported in Ch. Birbal Singh Vs. Harphool Khan (AIR 1976 Allahabad 23), it was held that execution of documents consists of signing of the document written out, read over and understood and does not consist of merely signing of a blank paper. In another decision reported in Thakurlal Vs. Ramadhar (1986 ALJ 480), it had been held that mere admission of putting of signature and thumb mark on a blank sheet of paper is not admission of execution of the document. In the present case, accused did not dispute the signature on cheques, but his specific case is that he had entrusted with the complainant five blank cheques which contained his signature and th impugned cheques is one of those cheques. Considering the aforesaid facts, I opine that there are suspicious circumstances surrounding the transaction and the stand of the accused that cheques were given blank seems to be believable.
26. Also, in the case of "Gopal Vs. Tonney Varghese" 2008 (1) Civil Courts Cases. 642 (Kerla) it has been held that mere proof of signature on cheque is not proof of its execution. In the absence, of any positive evidence regarding the execution of the cheque by the accused, it is to be held that the accused had issued only blank cheque CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 22 of 25 and the same was not executed by him. Simply because the cheque contained the signature of the accused, it cannot be said that the cheque was drawn by the accused as contemplated by Section 138 N.I. Act.
27. From the statutory language used in section 138 N.I. Act, the intention of the legislature can be inferred. The every word has been used with a specific meaning and intention. While interpreting the language of the statute the court is suppose to give effect to the intention of the legislature. In any way , it cannot be said that putting signature on the blank cheque is equivalent to the word 'drawn' used in section 138 of the NI Act. Therefore, the word 'drawn' used in Section 138 has to be understood as 'execution of cheque'. A person is said to have "drawn" a cheque, if he has made, prepared or created a cheque. A Cheque is an instrument which is created in conformity with the requirement of section 6 read with section 5 of the N.I. Act. A reading of Section 5 and 6 shows that a cheque consists of mainly, two parts. One is, an unconditional order in writing directing the banker to pay a certain sum of money only, or to the order of a certain person or to the bearer of the cheque. The second part is the signature of the drawer.
CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 23 of 25
28. When the execution of the cheque is denied by the accused, it is for the complainant to establish the same. In the absence of any positive evidence regarding the execution of the cheque by the accused, it is to be held that the accused had issued only blank cheque and the same was not executed by him. Simply because the cheque contained the signature of the accused, it cannot be said that the cheque was drawn by the accused as contemplated by Section 138 of the NI Act.
29. In view of the above discussion, I hold that the complaint has not come to the court with the clean hands. The complaint failed to prove the outstanding liability of the accused on the date of issuance of impugned cheque whereas same has been disputed by the accused. Complaint witness failed to tell and establish the actual liability of the accused, moreover same was not proved by placing on record accounts book or statement of account. Accused has proved non existence of consideration by raising probable defence. He has discharged initial onus by proving that existence of liability as improbable, doubtful and illegal thereby shifting the onus to complainant. He has brought on record some material evincing that cheque in question might have issued as CC No. 1013/12/07 M/s The Abhilasha CoOperative Urban Thrift & Credit Society Ltd. vs. Vijay Kumar 24 of 25 blank signed for security purpose and not towards the discharge of any debt or liability in the manner as has been alleged by the complainant and therefore, it will not fall within the province of section 138 NI Act.
30. In view of the above discussion, It is held that complaint has failed to establish that cheque in question was drawn by the accused towards discharge of any legal liability . No material is placed on on record which could prove that accused was liable to pay the cheque amount on the date of its issuance. Therefore accused Vijay Kumar stands acquitted from the offence under section 138 N.I. Act. Bail bonds stands discharged.
(Announced in the open court on 28.07.2012) This Judgment contains 25 pages and each paper is signed by me.
(BABRU BHAN)
METROPOLITAN MAGISTRATE
DWARKA COURTS /NEW DELHI
CC No. 1013/12/07
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