Delhi District Court
Manoj Tiwari vs ) State Of Nct on 26 March, 2021
IN THE COURT OF SH. AJAY GUPTA
ADDITIONAL SESSION JUDGE05 (EAST)
KARKARDOOMA COURTS: DELHI
Criminal Appeal No.96/19
Manoj Tiwari
S/o Chandrika Tiwari
R/o H.No.358A, Krishnapuri,
Block Gali No.4, Mandawali Fazalpur,
Shakarpur Baramda East, Delhi110092
....Appellant
versus
1) State of NCT
2)Urmila Devi
W/o Sh. Uttam Rai,
r/o 358A, Krishnapuri,
Gali No.4, Mandawali, Delhi110092
....Respondent
Date of institution 20.05.2019
Arguments heard 03.03.2021
Date of order 26.03.2021
JUDGMENT
1. The present appeal has been filed against the judgment dated 30.03.2019 and order on sentence dated 20.04.2019 passed by Sh. Rakesh Kumar Singh, Ld. MM03 (East), Karkardooma Courts, Delhi, in the complaint case bearing CC No.45827/16 titled as Urmila Devi vs Manoj Tiwari filed U/s 138 of Negotiable Instruments Act (hereinafter referred as NI Act). Vide the aforesaid judgment Ld. MM has convicted the appellant u/s 138 NI Act and vide order dated 20.04.2019, the appellant has been sentenced to undergo simple Cr. Appl No.96/19 Manoj Tiwari vs State 1 of 35 imprisonment for a period of six months and to pay Rs.3,00,000/ as compensation to the complainant. In case of default of payment, the convict/appellant shall undergo simple imprisonment for one month.
2. The brief facts of present case are that the respondent/complainant filed a complaint u/s 138 of N.I. Act against the appellant/accused (hereinafter both the parties have been referred as they were arrayed in the complaint case) on the basis of the following allegations:
(a) That the accused and his wife were having friendly relations with the complainant. In the month of June, 2015, accused was in dire need of money for his business purpose and he approached the complainant for financial help of Rs.8 lakhs for two months. The complainant gave a sum of Rs.8 lakhs to the accused.
(b) That accused issued a cheque no.360645 dated 22.07.2015 for Rs.2,00,000/ drawn on State Bank of India, Maharajpur, PO Bharat Nagar, Ghaziabad to the complainant in discharge of partial liability. The cheque got dishonoured when complainant presented the same with her banker i.e. Punjab National Bank, Madhuban, Delhi with remarks "Payment Stopped by the Drawer".
(c) Thereafter, the complainant, through her counsel, sent a legal notice dated 30.09.2015 to the accused by registered post. Despite service of legal notice, accused failed to make payment of the dishonoured cheque amount. Complainant prayed that Cr. Appl No.96/19 Manoj Tiwari vs State 2 of 35 accused may be summoned for committing offence u/s 138 of NI Act & 420 of IPC.
3. On 03.04.2018, notice u/s 251 Cr.P.C for commission of the offence u/s 138 N. I. Act was served upon the accused to which he pleaded not guilty. Certain questions were put to the accused to which accused replied as under: Q3. Does the cheque Ex.CW1/1 bear your signature and was the same issued by you?
A3. Yes, I had given the cheque to the complainant, but it was a blank signed cheque.
Q4. Did you receive legal demand notice Ex.CW1/5? A4. No. However, address appearing on legal demand notice belong to me.
Q5. Do you have anything else to say?
A5. Complainant was running a committee of which I was a member. I had issued blank signed cheque as a guarantee for repayment of the committee amount.
4. In support of her case, complainant examined herself as CW1, Sh. Vidya Bhushan Rai as CW2 and Sh. Achche Lal as CW3.
5. CW1/Smt. Urmila Devi reiterated the facts of her complaint and brought on record following documents:
a) Original cheque no.360645 Ex.CW1/1.
b) Cheque returning memo Ex.CW1/2.
c) Copy of passbook Ex.CW1/3.
d) Copy of loan agreement between complainant and accused Ex.CW1/4.
e) Legal demand notice Ex.CW1/5.
f) Postal receipts and Ad Card Ex.CW1/6 (colly) and Ex.CW1/7.
Cr. Appl No.96/19 Manoj Tiwari vs State 3 of 35
6. CW2 is Vidya Bhushan Rai. This witness deposed in his affidavit Ex.CW2/A that Ms. Urmila Devi approached him in the month of June 2015 and sought for financial help as accused Manoj Tiwari had asked for financial help of Rs.8,00,000/ from Ms. Urmaila Devi. Since Ms. Urmila Devi was not having the said amount, she sought for some financial help from him and he gave Rs.3,00,000/ to Ms. Urmila Devi for the said purpose. CW2 further stated in his affidavit that Manoj Tiwari also gave in writing on stamp paper regarding having borrowed the sum of Rs.8,00,000/ from Ms. Urmila Devi and he stood witness to the loan agreement Ex.CW1/4.
7. CW3 is Sh. Achche Lal Pandey. He gave his evidence by way of his affidavit Ex.CW3/A. He is also a witness to the loan agreement Ex.CW1/4.
8. Accused had moved an application u/s 145(2) of NI Act wherein he took the following defence: "..the applicant never received any amount from the complainant and there is no due of any kind upon the applicant and as such the cheques in question were issued for security purpose for the committee run by the complainant but the same has not been returned by the complainant despite repeated requests and visits of the applicant/accused and the complainant has avoided intentionally and deliberately to return the cheques in question in order to misuse the same and also to extort the money from the applicant/accused..."
9. After completion of complainant's evidence, the statement of accused was recorded under section 313 Cr.P.C wherein all Cr. Appl No.96/19 Manoj Tiwari vs State 4 of 35 incriminating evidence was put to accused in the form of questions to which accused replied as under: Q. It is in evidence against you as deposed by the complainant and his witnesses namely Achche Lal and Vidhya Bhushan that you had taken loan from the complainant for a sum of Rs.8,00,000/. What do you have to say?
A. I have not taken any such loan from the complainant. Q. It is in evidence against you that towards discharge of your aforesaid liability, you issued three cheques to the complainant. What do you have to say?
A. I had given three blank signed cheques to the complainant.
Q. It is further in evidence against you that the aforesaid cheques were dishonoured by the bank. What do you have to say?
A. It is correct.
Q. It is further in evidence against you that a legal notice
was served upon you. What do you have to say?
A. Yes.
Q. It is further in evidence against you that you had
executed a document titled as Loan Agreement in which you had accepted Rs.8,00,000/ from the complainant. What do you have to say?
A. I have not executed any loan agreement. The loan agreement does not bear my signature.
Q. Do you want to say anything else?
A. The cheques in question were issued as a security
cheques to the complainant in the blank form against committee which was run by the complainant.
Cr. Appl No.96/19 Manoj Tiwari vs State 5 of 35
10. On dated 23.01.2019, Ld. Counsel for accused made a statement before the court that accused does not wish to lead evidence in his defence, therefore, defence evidence was closed.
11. On completion of the trial, Ld. Trial Court convicted the accused thereby holding that accused failed to raise probable defence and rebut the presumption u/s 139 of NI Act.
12. Now the present appeal has been filed by the appellant/accused mainly on the following grounds:
(a)That the impugned judgment and order on sentence are neither sustainable nor tenable in the eyes of law as Ld. Trial Court has failed to appreciate the facts and circumstances of the case.
(b)That the accused was always willing to lead defence evidence but it is unfortunate that when accused told his counsel that he can not lead his evidence on that day, the counsel missed the word "that day" and DE was closed on the statement of counsel. The then Ld. Counsel for appellant did not pursue the case of the appellant with due diligence and the appellant should not be made to suffer on such account.
(c) That the complainant was a poor lady and was earning Rs.8000/ per month. About the financial capacity, complainant proved that she herself had no such capacity and failed to show that she borrowed Rs.3 lakhs from CW3 and Rs.2 lakhs from CW2 and rest of the money from her bank. CW3 stated that he arranged Rs.3 lakhs prior to the demand of loan by the accused while CW2 Cr. Appl No.96/19 Manoj Tiwari vs State 6 of 35 stated that he arranged Rs.2 lakhs in July 2015 much after the date of advancement of loan. The complainant is a poor lady and she was not in position to advance financial help of Rs.8 lakhs to the accused that too without interest.
(d)That the Ld. Trial Court failed to appreciate that the story of the complainant is highly improbable as the accused denied his signature on the loan document Ex.CW1/4 and it can be read against the complainant. This document shows that it was prepared/forged on 25.07.2015 while it is claimed that loan was given on 01.06.2015 and same was to be repaid on 01.08.2015 and these facts are not mentioned in the complaint. The loan agreement was executed on 25.07.2015 while the first cheque was presented on 15.07.2015 and second on 22.07.2015.
(e)That the loan agreement Ex.CW1/4 is forged document and post dated document which is created to show the advancement of debt and financial capacity but this document is against the pleadings of the complainant. If loan was demanded in June 2015 then the same cannot be advanced on 01.06.2015.
(f) That if the loan was to be repaid after 01.08.2015 then the factum of presentation of cheque in bank on 15.07.2015 is not tenable. There cannot be any reason in absence of any business relations that a loan of cash was required to be returned in one month.
Cr. Appl No.96/19 Manoj Tiwari vs State 7 of 35
(g)That under section 118(g) of NI Act, if any offence is connected with the forgery or misappropriation of the cheque then complainant has to prove his case beyond reasonable doubt.
(h)That the accused is an extenant of complainant and poor person so accused cannot think even in dreams to play with Rs.8 lakhs. Thus, it is prayed that impugned judgment and order on sentence may be set aside.
13. I have heard the submissions of Ld. Counsel for the appellant/ accused as well as Ld. Counsel for the respondent/complainant and gone through the record.
14. It is held by Hon'ble Supreme Court in the case of 2000 (2) SCC 745 titled as M/s Kusum Ingots & Alloys Ltd. Vs M/s Pennar Peterson Securities Ltd that to constitute an offence u/s 138 of Negotiable Instruments Act the following requirements are to fulfilled:
a) a person must have drawn a cheque on an account maintained by him in a bank for payment of a certain amount of money to another person from out of that account for the discharge of any debt or other liability;
b) that cheque has 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;
c) that cheque is returned by the bank unpaid, either because of the amount of money standing to the credit of the account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with the bank;
d) the payee or the holder in due course of the cheque makes a demand for the payment of the said amount of money by giving a Cr. Appl No.96/19 Manoj Tiwari vs State 8 of 35 notice in writing, to the drawer of the cheque, within 15 days (after amendment in 2003 notice is to be issued within 30 days) of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
e) the drawer of such cheque fails to make payment of the said amount of money to the payee or the holder in due course of the cheque within 15 days of the receipt of the said notice.
15. In view of the law laid down by the Hon'ble Supreme Court in the aforesaid case, it is to be seen, if the aforesaid requirements have been fulfilled in the present case. The complainant has claimed that she had advanced a loan of Rs.8 lakhs to accused and in discharge of this liability, accused had issued three cheques out of these three cheques, one cheque no.360645 (Ex.CW1/1) is the subject matter of the present case and two cheques are subject matter of connected criminal appeal no.95/19 titled as Manoj Tiwari vs State and Anr. The accused has disputed the claim of the complainant and has taken a defence that the complainant was running a committee (chit fund) and he was one of the members of the said chit fund and he had issued blank signed cheques as guarantee for repayment of the committee amount (prize money).
16. As per complainant, after dishonour of said cheque, legal notice Ex.CW1/5 was sent to accused by registered AD post at his all three addresses. The postal receipts and with AD Card have been brought on record as Ex.CW1/6 and Ex.CW1/7. At the stage of framing of notice u/s 251 Cr.P.C, the accused while giving reply to the allegations made in the complaint, denied the service of the legal notice but accepted the correctness of the address mentioned on Cr. Appl No.96/19 Manoj Tiwari vs State 9 of 35 the notice. However, subsequently at the stage of statement u/s 313 Cr.P.C, accused categorically admitted the service of legal notice. Furthermore, it is clear from the affidavit of complainant/CW1 that she has deposed that the accused was duly served with the legal notice. This part of the statement of the complainant remained unrebutted as the factum of service of legal notice has not been disputed by the accused during her crossexamination. Besides, the accused has also not disputed the correctness of the addresses upon which the legal notice was sent to the accused. It is further clear from the record that in the complaint also very same address was mentioned and notice was issued to the accused at those addresses and thereafter accused joined the trial of the case. It is well settled law that in case, the legal notice was issued to the accused at the correct address then it is to be presumed that the notice was served upon the accused. Thus, in view of law laid down by Hon'ble Supreme Court in the case of C.C. Alavi Hazi vs. Palapetti Muhammed and Anr 2007 (6) SCC 555, the legal notice is presumed to have been served upon the accused.
17. Thus, from these facts and circumstances, it is clear that the accused was well aware of the factum of dishonour of the cheque. It is further clear from the record that accused did not pay the dishonoured cheque amount neither within 15 days of the service of the legal notice nor thereafter. Thus, it is clear from the record that all necessary requirements to constitute the offence u/s 138 N.I. Act, Cr. Appl No.96/19 Manoj Tiwari vs State 10 of 35 have been fulfilled except that whether on the date of presentation of cheque by the complainant, the cheque was against due debt or were without consideration as claimed by the accused. This point will be discussed in the later part of the order and before making further discussions on the factual aspects of the case, it is deemed necessary to firstly discuss the relevant provisions of N.I Act and the legal position which is required to be taken into consideration for appropriate disposal of the complaint U/s 138 of N.I Act.
18. The claim based under the provisions of Negotiable Instruments Act is an exception to the general rule of law that burden of proof lies on the prosecution. There are two specific provisions in negotiable instruments acts i.e. section 118 (a) and 139 of NI Act which contemplates that a presumption is attached in regard to each and every negotiable instrument that the same was drawn and issued against due discharge of the liability and thus, whenever any claim is made on the basis of a negotiable instrument, the presumption has to be drawn in favour of the holder of the cheque (drawee) and the law has put the burden to rebut the presumption on the accused that the cheque was not issued by him against discharge of a debt or a liability. In case, the accused is not able to rebut the presumption and fails to prove his defence, the presumption becomes absolute and it has to be assumed that the cheque was issued by the accused in discharge of debt or liability and consequently, accused Cr. Appl No.96/19 Manoj Tiwari vs State 11 of 35 has to be assumed guilty of the offence. The relevant provisions of section 118 (a) and section 139 of NI Act reads as under: Sec 118 Presumptions to negotiable instruments.Until the contrary is proved, the following presumption shall be made:
(a) of consideration that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated, or transferred for consideration.
139. Punishment in favour of holder: It shall be presumed, unless the contrary is provided, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability.
19. It has been held by Hon'ble Supreme Court in the case reported as 2001 (6) SCC 16 titled as Hiten P. Dalal v. Bratindranath Banerjee that the presumption mentioned in the section 139 of NI Act, is a presumption of law and not the presumption of fact and thus, this presumption has to be drawn in favour of the drawee and burden to rebut the presumption with the probable defence is on the accused. The relevant para of the aforesaid case law reads as under:
21. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the Court but 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" [Section 3 : Evidence Act].
Cr. Appl No.96/19 Manoj Tiwari vs State 12 of 35 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.
20. It has been held by the Hon'ble Supreme Court in the case of reported as 2010 (11) SCC 441 titled as Rangappa v. Mohan that presumption of section 139 of N.I. Act also includes the existence of legally enforceable debt. The relevant para of the said judgment reads as under:
14. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability.
21. In Bharat Barrel v. Drum Manufacturing AIR 1999 SC 1008, the Hon'ble Supreme Court held that the accused has to rebut the presumption and mere denial of passing of consideration is no defence.
22. Thus, in view of the law laid down by the Hon'ble Supreme Court in the aforesaid cases, the presumption as contemplated under section 139 N.I. Act has to be drawn in favour of the drawee that the cheque in question was issued in discharge of legally enforceable liability. Thus, in the present case also complainant was not required to prove that the subject cheque was issued by the accused towards repayment of loan amount and initially, the claim of the complainant was to be assumed to be correct by drawing the presumption of Cr. Appl No.96/19 Manoj Tiwari vs State 13 of 35 section 139 of N.I. Act and burden to rebut the presumption with his probable defence was on the accused.
23. In the present case, the accused has taken a defence that he had not taken loan of Rs.8 lakhs from the complainant and it is stated by the accused that the complainant was running a committee and he had given the subject cheque to the complainant against security of a committee which has been misused by the complainant. Thus, it is clear that the accused has not disputed the factum of issuance of subject cheque but he took a defence that subject cheque was issued as a security to the complainant for the purpose of committee (chitfund). Thus, the accused endeavoured to contend that he does not owe anything to the complainant. Thus, the accused was required to establish on record the aforesaid defence taken by him. However, after considering the record and the evidence, it is clear that accused has miserably failed to prove his defence and the defence of the accused is apparently not trustworthy for the following various reasons:
(a)It is undisputed that the complainant and accused were known to each other and as per accused; he had given the subject cheque to the complainant towards security of the committee of Rs.8 lakhs. This is the sole defence taken by the accused to explain as to how the subject cheque came into possession of the complainant. It is undisputed that the subject cheque was handed over by the accused to the complainant. The accused has simply Cr. Appl No.96/19 Manoj Tiwari vs State 14 of 35 taken this defence that he had given the subject cheque as security towards the committee; however, this defence of the accused is bereft of necessary particulars. It is clear that in his application u/s 145(2) NI Act as well as in his statement u/s 313 Cr.P.C., the accused has reiterated the same defence, however, no particulars, whatsoever, have been provided regarding the committee (chitfund). In order to establish his defence, the accused was required to firstly bring on record as to on which date, the committee was started and as to when he became member of the same. He was also required to specify as to how many members were the part of the said committee and the details of the amount which he contributed towards his share as well as the dates on which the said amount was paid. He was further required to specify as to when the committee had begun and as to when it came to an end. He was also required to specify the amount of prize money and the date when he was given the prize money. The accused has simply taken this defence, however, despite having several opportunities from the time of filing of application u/s 145(2) NI Act, and till the conclusion of trial, however, he neither brought on record the said requisite particulars of the committee nor led any evidence to establish his aforesaid defence. Normally, a chitfund consists several members and therefore, in case, he was one of the members of chitfund, he ought to have provided the particulars of the other members of the chitfund and ought to have examined some of Cr. Appl No.96/19 Manoj Tiwari vs State 15 of 35 them to establish that he was one of the members of a committee which was being run by the complainant. However, the accused is completely silent in this regard and he has simply taken this defence but did not bring on record the aforesaid requisite particulars/evidence to establish the same.
(b)The dates regarding beginning of chitfund and its finalization were very relevant in order to see, if there is any substance in this defence raised by the accused. In case, the subject cheque was given by the accused to the complainant as security towards committee and he had successfully paid all the installments/contribution and the chitfund had successfully completed its period, then accused was entitled to take back the subject cheque which according to him were given to the complainant as security. It is clear that the accused did not specify the schedule i.e. the starting and completion period of chitfund/committee. Firstly, the defence regarding the committee is not trustworthy as neither the requisite particulars have been furnished nor any evidence has been led by the accused in this regard. Furthermore, if it is assumed that the subject cheque was given as security towards the committee then after completion of chitfund period, the accused must have sought return of his security cheque, however, it is not the case of the accused that the committee was completed successfully and despite its completion, the complainant did not return the cheque. In his Cr. Appl No.96/19 Manoj Tiwari vs State 16 of 35 application u/s 145(2) of NI Act, the accused took a defence that complainant did not return the subject cheque despite repeated request and visit of the accused. It seems from the record that accused has simply taken defence in his application, however, neither he never led any evidence to establish this defence nor he brought this defence on record during the crossexamination of complainant/CW1. No such suggestion was put to the complainant in this regard. Thus, it is clear that there is nothing on record to show that the subject cheque was ever sought back by the accused. The complainant has not been crossexamined on the material aspect of the particulars of the committee. No suggestion has been given to the complainant that the subject cheque was given to the complainant as security towards the committee of Rs.8 lakhs and complainant did not return these cheque despite the committee completed successfully. It is clear from the record that the accused has not brought on record any particulars to show that he has ever sought return of his security cheque from the complainant. In case, the subject cheque would have been given as security towards the committee as claimed by accused, he must have sought return of the same after committee was over as in that case, complainant was not legally entitled to retain the cheque after the transaction was over. It is also not the case of the accused that he had sought return of the subject cheque and complainant had refused to return the same. In case, the subject cheque would have been given only as a security and Cr. Appl No.96/19 Manoj Tiwari vs State 17 of 35 the transaction about which the same were given, would have come to an end, he must have sought return of the cheque and would have not remained silent as subject cheque was duly signed and were a valuable security. It is clear that the accused never sought return of subject cheque after the same was handed over to the complainant.
(c) It is admitted position of fact that after dishonour of the subject cheque, a legal notice Ex.CW1/6 was issued to the accused and admittedly, it was duly served upon him. Even if it is assumed that the accused did not seek return of cheque after the transaction was over, however, after service of legal notice, he must have come to know that the complainant has presented the cheque for encashment and now she is demanding money mentioned in the dishnoured subject cheque through the legal notice. He also must have come to know that the complainant would stake claim on the basis of the subject cheque, in case, he does not pay the demanded amount. However, it is clear that the even after service of the legal notice, the accused kept silent and did not send any reply refuting the claim raised by the complainant and he also did not seek return of the subject cheque, though, according to him, the complainant was not even legally entitled to hold back the security cheque, yet complainant had presented the cheque for encashment and thereafter she starting demanding the amount mentioned in the cheque. In case, the subject cheque would Cr. Appl No.96/19 Manoj Tiwari vs State 18 of 35 have come into the possession of complainant as claimed by the accused, then after service of legal notice, the accused must have taken prompt action against the complainant seeking return of cheque, however, he remained completely dormant even after service of legal notice and did not take any action whatsoever. It has been held by Hon'ble Delhi High Court in the case reported as 172 (2010) DLT 561 V.S. Yadav Vs. Reena that it is for the accused to rebut the presumption of section 139 of N.I. Act and also that under what circumstances he had issued the cheque to the complainant as issuing a cheque is a serious business. It is also held that if the cheque was not issued in discharge of the debt then accused is supposed to take appropriate action seeking return of his cheque. In case the accused failed to establish the reason of issuance of cheque and also why he did not seek return of the cheque then it is to be assumed that he failed to rebut the presumption. The relevant portion of the para no.7 of the said case reads as under: 'In order to rebut the presumption under Section 139 of N.I. Act, the accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the accused to prove if no loan was taken why he did not write a letter to the complainant for return of the cheque. Unless the accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption u/s 139 N.I. Act. If no loan was given, but cheques were retained, he immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he Cr. Appl No.96/19 Manoj Tiwari vs State 19 of 35 would have served a notice as complainant. Nothing was proved in this case.'
(d)Furthermore, perusal of record shows that in the present case, the subject cheque was lastly presented by the complainant for encashment in the month of September 2015 and same got dishonoured. Thus, the accused must have come to know that the complainant has presented the subject cheque for encashment and same got dishonoured. However, it is clear from the record that the accused did not take any action against the complainant for allegedly misusing the subject cheque. As per accused the complainant was not even entitled to retain and hold back the subject cheque, however, she presented the same for encashment. The inaction on the part of the accused subsequent to the dishonour of subject cheque further makes it ample clear that he had issued subject cheque towards the part payment of the loan amount else he would have taken action against the complainant.
(e) Moreover, when accused has taken the plea of forgery, thus, in view of the provisions of section 8 of Evidence Act, his conduct subsequent to the alleged forgery is also a relevant fact to the matter in issue. It is to be seen as to whether the accused acted diligently after the factum of alleged forgery revealed to him or he remained dormant. It is clear from the record that accused had come to know about the alleged forgery after filing of the complaint; however, it is clear from the record that he did not take Cr. Appl No.96/19 Manoj Tiwari vs State 20 of 35 any action against the complainant for the alleged act of forgery. No prudent man would keep silent when a serious offence of forgery is committed against him especially when the alleged offender also wants to misuse the forged documents in the legal proceedings i.e in a criminal complaint. Thus, accused had come to know about the alleged misdeeds on the part of the complainant, however, the accused has not taken any action against the complainant till date. The inaction on the part of the accused speaks for itself that the documents were duly executed and no forgery was committed with him. Furthermore, since, the accused has taken the defence of forgery; thus, in view of the provisions of section 101 of Evidence Act, the onus was on him to prove his claim of forgery. It has been held in the case reported as AIR 2012 Gau 183 titled as Pawan Kumar Patodia Vs Vijoy Kumar Bhutoria that heavy burden lies on the party concerned to prove the claim of forgery which has taken this plea. Relevant portion of this case is reproduced as under: 'There is also no pleading in the plaint who has forged the transfer deeds. It is a settled position of law that when the allegation of forgery is made, the burden heavily lies on the person making such allegation to prove such forgery. No amount of evidence has also been laid to prove any forgery against the appellant/defendant No.6.'
(f) It has been contended on behalf of the appellant that the complainant has not established her financial capability to avance loan to the tune of Rs.8 lakhs. It is contended that the appellant Cr. Appl No.96/19 Manoj Tiwari vs State 21 of 35 has claimed that out of Rs.8 lakhs, she got arranged Rs.2 lakhs from CW2 and Rs.3 lakhs from CW3. It is stated that as per complainant the loan was given in June 2015 but CW2 has deposed that he had given the money to the complainant in July 2015 i.e. after the period the complainant claimed to have advanced the loan to the accused. Thus, it is contended that the complainant has failed to establish her financial capability and also that her claim has not been supported by her witnesses. Thus, it is stated that complainant has failed to prove her case beyond reasonable doubt. Before making any discussion about the legal requirement of proving the financial capability by the complainant, it is to be seen whether the accused has been successful in rebutting the presumption u/s 118 and 139 of N.I. Act. As discussed above, it is well settled law that in view the provisions of Sec 118 as well as 139 N.I. Act, initially, it has to be presumed that the subject cheque was drawn against due consideration and onus is always on the accused to rebut the settled legal presumptions with his probable defence, however, it is clear from the discussions already made in the preceding paras that accused has miserably failed to prove his defence. The defence of the accused is not supported by any relevant evidence and it is well settled law that simple denial of liability cannot be taken as rebuttal to the settled presumption. Accused was required to establish on record that the subject cheque had entered in the hands of the complainant as claimed by him. It is Cr. Appl No.96/19 Manoj Tiwari vs State 22 of 35 well settled law that the presumption u/s 139 NI Act cannot be rebutted by simply making statement and accused has to bring on record the evidence to prove the defence taken by him. In this regard, this court is supported with the case law reported as "Hiten P. Dalal v. Bratindranath Banerjee, (SC) : 2001(5) BCR 820". The relevant para of the judgment reads as under:
21. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the Court but 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" [Section 3 :
Evidence Act]. 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'.
22. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram v. Custodian, Evacuee Property, Bombay, AIR 1961 Supreme Court 1316, this Court held that the presumption of law under Section 118 of Negotiable Instruments Act could be rebutted, in certain circumstances, by a presumption of fact raised under Section 114 of the Evidence Act. The decision must be limited to the facts of that case. The more authoritative view has been laid down in the subsequent decision of the Constitution Bench in Dhanvantrai Balwantrai Desai v. State of Maharashtra, AIR 1964 Supreme Court 575, where this Court reiterated the principle enunciated in State of Madras v. Vaidyanath Iyer (supra) and clarified that the distinction between the two kinds of presumption lay not only in the mandate to the Court, but also in Cr. Appl No.96/19 Manoj Tiwari vs State 23 of 35 the nature of the evidence required to rebut the two. In the case of a discretionary presumption the presumption if drawn may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before if the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted........."
[See also V.D. Jhingan v. State of Uttar Pradesh, AIR 1966 Supreme Court 1762; Sailendranath Bose v. The State of Bihar, AIR 1968 Supreme Court 1292 and Ram Krishna Bedu Rane v. State of Maharashtra, 1973(1) SCC 366.]
23. We will therefore have to consider whether in the case before us, the appellant had supported his defence by any proof sufficient to rebut the presumption drawn against him.
(g) It is well settled law that simple denial of liability cannot be termed to be a valid defence of the accused. In "K.N. Beena v. Maniyappan (SC), Criminal Appeal No. 1066 of 2001", it has also been held by the Hon'ble Supreme Court that the burden is on accused to prove his defence by way of cogent defence evidence and if he fails to prove that the cheque was not issued Cr. Appl No.96/19 Manoj Tiwari vs State 24 of 35 against debt or liability then presumption u/s 139 NI Act would remain unrebutted. Relevant paras reads as under:
6. In our view the impugned Judgment cannot be sustained at all. The Judgment erroneously proceeds on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant. It appears that the learned Judge had lost sight of Sections 118 and 139 of the Negotiable Instruments Act. Under Section 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. 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 a 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. However the burden of proving that a cheque had not been issued for a debt or liability is on the accused. This Court in the case of Hiten P. Dalal v. Bratindranath Banerjee, 2001 (3) RCR (Crl.) 460 SC : 2001(6) SCC 16 has also taken an identical view.
7. In this case admittedly the 1st Respondent has led no evidence except some formal evidence. The High Court appears to have proceeded on the basis that the denials/averments in his reply dated 21st May, 1993 were sufficient to shift the burden of proof onto the Appellant/Complainant to prove that the cheque was issued for a debt or liability. This is an entirely erroneous approach. The 1st Respondent had to prove in the trial, by leading cogent evidence, that there was no debt or liability. The 1st Respondent not having led any evidence could not be said to have discharged the burden cast on him. The 1st Respondent not having discharged the burden of proving that the cheque was not issued for a debt or liability, the convection as awarded by the Magistrate was correct. The High Court erroneously set aside that conviction.
(h) It has been held by the Hon'ble Delhi High Court in the case reported as "Sanjay Arora vs. Monika Singh (Cri. Appeal Cr. Appl No.96/19 Manoj Tiwari vs State 25 of 35 no.98/2017)" that the onus is on the accused to rebut the presumption either by direct evidence or by bringing on record the required material, however, the simple denial of liability is not sufficient to rebut the presumption.
(i) In view of the facts and circumstances of the present case, it is clear that accused failed to rebut the presumptions exist in favour of the complainant, consequently, in view of the settled legal position, It is to be held that the subject cheque was drawn by the accused against due consideration. Furthermore, it is clear from the evidence of complainant/CW1 that she categorically deposed in her affidavit that the part of the loan was from her savings and she had got arranged Rs.5 lakhs from CW2 (Rs.3 lakhs) and CW3 (Rs.3 lakhs). In order to support her claim, complainant brought on record document i.e. Ex.CW1/4 and the authenticity of this loan agreement has not been assailed during the cross examination of CW1. During crossexamination of CW1, the accused has neither denied the execution of loan document and his signature/thumb impression over the same. The photo of the accused has also been affixed on this agreement which is also not disputed. It has never been the case of the accused that at the time of becoming member of the committee, he had signed any blank document or had handed over his photographs to the complainant. During the course of arguments, Ld. Counsel for appellant has pointed out certain aspects qua Ex.CW1/4. Ld. Cr. Appl No.96/19 Manoj Tiwari vs State 26 of 35 Counsel submitted that as per this loan agreement, the loan was given on 01.06.2015, however, the loan agreement was executed on 25.07.2015 which happened subsequent to the presentation of the subject cheque. The case of the complainant is not solely based upon the loan agreement and it has been filed mainly on the basis of subject cheque and therefore, the loan agreement Ex.CW1/4 can be read in support of the claim of the complainant regarding loan. Perusal of record shows that the subject cheque has been presented twice by the complainant with her banker. Firstly she presented the cheque on 24.07.2015 and subsequently on 02.09.20215. It is clear from the record that the subject cheque was presented by the complainant just one day before the execution of loan agreement. As per complainant, the accused had approached her for obtaining a loan of Rs.8 lakh in the month of June 2015 and she provided him the said amount. Thus, it is clear that she had given the loan amount to the accused in the month of June 2015. The accused has endeavoured to contend that the loan agreement is a forged and fabricated document as the subject cheque was presented prior to the execution of loan agreement. This court does not find any substance in this plea of the accused as there is no legal bar to prepare memorandum of loan transaction subsequent to the date of actual loan transaction which seems to have happened in the instant case also. In case, the appellant/accused would not have executed the loan agreement then the agreement would neither Cr. Appl No.96/19 Manoj Tiwari vs State 27 of 35 have his photograph nor his signature and thumb impression on each page of loan agreements. Thus, it is clear from the perusal of loan agreement that the loan agreement was signed by the accused after the same was prepared. It is clear from the record that the accused has not disputed the authenticity of the photographs and signatures on loan agreement during cross examination of complainant witnesses examined by the complainant. Thus, it is clear that the appellant has failed to assail the authenticity of the loan agreement Ex.CW1/4. As far as some of the discrepancies about the loan agreement, which have surfaced during the crossexamination of CW2 and CW3 are concerned, same are immaterial and do not create doubt about the authenticity of the loan document. Thus, it is held that the claim of the complainant qua loan transaction is based upon the dishonoured subject cheque as well as upon the loan agreement Ex.CW1/4. Further, the accused has not specified the reason as to how his signatures and thumb impressions came on the Ex.CW1/4. It is clear from the record that accused has been completely inactive and dormant throughout and has not taken any action against the complainant for her committing the alleged forgery and this conduct of the accused also makes everything amply clear that he kept mum for the sole reason as the complainant had raised a genuine claim. As far as proving the financial capacity is concerned, it has been held in recent pronouncement of Hon'ble Apex Court reported as SLP (Cri.
Cr. Appl No.96/19 Manoj Tiwari vs State 28 of 35 No.3858/2019) titled Pavan Diliprao Dike vs Vishal Narenderbhai Parmar that heavy burden to prove the financial capability cannot be laid on the complainant in a cheque bounce case. In the case of T. Vasanthakumar Vs Vijaykumari reported as 2015(3) SCC (Cri) 609 also, the complainant had failed to prove the source of payment of loan amount of Rs.5 Lakh to the accused. In the case of T. Vasanthakumar, the Hon'ble Apex Court has held that the presumption of Sec 139 N.I. Act can be drawn in the cases where accused has admitted the issuance of cheque as well as his signature on the cheque and in case, he has failed to prove his defence, it is to be held that he has failed to rebut the presumption. In the case of T. Vasanthakumar while making the above said observations, Hon'ble Apex Court has relied upon the Judgment of Rangappa case.
(j) Furthermore, it has been recently held by Hon'ble Supreme court in the case of M. Abbas Haji vs T.N. Channakeshva (2019) 9 SCC 606 that it is for the accused to establish as to how his cheque entered into the hands of the complainant. The same view has been taken by the Hon'ble High Court of Madras in the case reported as 2019 (4) AICLR 873 titled as S. Ravi vs Kumarsan, Cr. Appeal No.63/2012. In the present case, the accused has taken a defence that he had handed over subject cheque to the complainant towards security of a committee, Cr. Appl No.96/19 Manoj Tiwari vs State 29 of 35 however, as discussed above the accused has not brought on record the requisite evidence in this regard. Thus, it is clear that in the instant case, the accused had made only assertion that he had given the subject cheque as security for the committee, however, he has failed to bring on record the relevant evidence in this regard. It has been held in the case of Binoy Bothra v. Jitendra Singh, Crl.Rev.P. 310 of 2014 that for proving existence of a fact, the relevant evidence is to be led and a particular fact cannot be proved by merely making an assertion about the same. The relevant para of the judgment reads as under:
20. Relying to the decisions of: (i) (2008) 7 SCC 655, Mallavarapu Kasivisweswara Rao v. Thadikonda Ramulu Firm and another; (ii)(2001) 6 SCC 16, Hiten P. Dalal v. Bratindranath Banerjee as well as (iii)Bir Singh v. Mukesh Kumar reported in (2019) 106 ACC 923, it has been submitted that unless the accused/petitioner failed to rebut the presumption created under the N.I. Act, the accused cannot succeed to deny such legal presumption under the law. Relevant observation of the decision in Hiten P. Dalal (Supra) is extracted hereinbelow for ready reference:
"23. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram v. Custodian, Evacuee Property, Bombay AIR 1961 SC 1316, this Court held that the presumption of law under section 118 of Negotiable Instruments Act could be rebutted, in certain circumstances, by a presumption of fact raised under Section 114 of the Evidence Act. The decision must be limited to the facts of that case. The more authoritative view has been laid down in the subsequent decision of the Constitution Bench in Dhanvantrai Balwantrai Desai v. State of Maharashtra AIR 1964 SC 575, where this Court reiterated the principle Cr. Appl No.96/19 Manoj Tiwari vs State 30 of 35 enunciated in State of Madras v. Vaidyanath Iyer (Supra) and clarified that the distinction between the two kinds of presumption lay not only in the mandate to the Court, but also in the nature of evidence required to rebut the two. In the case of a discretionary presumption the presumption if drawn may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words 'unless the contrary is proved' which occur in this provision make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......".
(k) Furthermore, the present case is a fit case where adverse inference should be drawn against the accused. It is clear from the aforesaid discussions that the legal notice was duly served upon the accused, however, it is clear from the record that accused did not reply to the said notice. It is clear from the legal notice that complainant claimed that the accused had issued the subject cheque to repay the loan amount and the same got dishonoured. Thus it is clear that after the service of legal notice the accused must have come to know that the complainant would use the cheque in the legal proceedings to claim the said amount, Cr. Appl No.96/19 Manoj Tiwari vs State 31 of 35 however, accused kept mum and did not take any action whatsoever against the complainant for her allegedly misusing the cheque and making a false claim. If the cheque was issued only towards security and at the time of sending legal notice by the complainant, he did not owe any amount and complainant had issued a false notice, the accused must have taken appropriate action against complainant for his alleged misdeeds but he kept silent. In the case reported as 2014 (8) AD (Delhi) 26 and titled as 'Santosh Mittal Vs. Sudha Dayal, the Hon'ble High Court has held that the adverse inference can be drawn against the accused where accused has failed to controvert the allegation by sending a reply to the legal notice. The relevant para of the said case reads as under: '21. Admittedly, no reply to the legal notice was sent by her thereby rebutting the allegations made by the complainant. As far back in the year 1980, in Kaluram v. Sita Ram, 1980 RCR Note 44, it was held by this Court that when serious allegations are made in a no tice and defendant failed to send any reply, then the allegations are deemed to have been admitted. Even in Rangappa (supra) relied upon by the learned counsel for the appellant it was observed that failure on the part of the accused to reply to the statutory notice under section 138 of the Act lead to inference that there was merit in complainant's version.'
(l) There is one more crucial aspect of the case which also points out that complaint has raised a genuine claim. As per accused, he had given the cheque towards security of the committee of Rs.8 lakhs and according to accused the complainant did not return these cheque and has misused the same. Thus, as per defence Cr. Appl No.96/19 Manoj Tiwari vs State 32 of 35 of the accused the entire transaction about the chit fund was done by him with the complainant and therefore, it was accused who was acquainted with all the facts and circumstances of the said transaction yet he did not chose to appear in the witness box to establish his said defence. In this matter, the appellant has filed an application u/s 391 Cr.P.C seeking permission to examine himself as defence witness. It has been stated in the application that the complainant got several opportunities to complete her evidence, however, proper opportunity to lead defence evidence was not given by the Ld. Trial Court. It is stated that on 23.01.2019, due to his unsound health, the accused had told his counsel about his incapability to lead defence evidence on that particular day but his counsel understood that the accused does not wish to lead his defence evidence and therefore, he gave his statement to close the defence evidence. The accused was not conversant with the language of the court, therefore, he could not raise any objection in this regard. Perusal of the Trial Court record shows that there is no merit in the grounds raised by the accused in his application u/s 391 Cr.P.C. It is clear from the record that on 19.12.2018, the statement of the accused was recorded u/s 313 Cr.P.C and he was granted an opportunity to lead defence evidence and matter was adjourned to 23.01.2019 for defence evidence. On 23.01.2019, the appellant/accused appeared along with his counsel and in the presence of accused, his counsel made a submission before Ld. MM that accused does not wish to Cr. Appl No.96/19 Manoj Tiwari vs State 33 of 35 lead any evidence in his defence and in this regard separate statement of Ld. Counsel for accused was also recorded. Thereafter, matter was listed for final arguments for 05.02.2019 and in case, the accused would not have chosen for not leading any defence evidence on 23.01.2019, then subsequently, he would have certainly made efforts to lead defence evidence. However, it is clear from the proceedings carried out before Ld. MM on 05.02.2019 that the matter was listed for final arguments and on that day the accused had appeared with his counsel and no such submission was made before the court either by the accused or by his counsel. On 05.02.2019, the matter was adjourned for final arguments for 14.02.2019, thus, in case accused had not chosen for closing of his defence evidence then he had got another opportunity to make a request for leading evidence in his defence. However, even on 14.02.2019, the accused did not make any effort in this regard and final arguments were addressed by both the Ld. Counsels and thereafter matter was posted for judgment. Thus, it is amply clear from the record that in case, there would have been any confusion in this regard then at least subsequent to 23.01.2019, the accused would have made his efforts to lead his evidence. All these facts clearly establish that the accused had consciously opted for not leading defence evidence and the plea raised by the accused in the application u/s 391 Cr.P.C is clearly an after thought. Thus, for this reason also an adverse inference should Cr. Appl No.96/19 Manoj Tiwari vs State 34 of 35 be drawn against the accused that he did not examine himself to avoid the questions which might have been preferred on behalf of the complainant and proved his defence unfounded.
24. Thus, it is held that the accused has failed to rebut the presumption and complainant by way of his evidence has established that the accused had issued the subject cheque qua return of the loan amount.
25. Since, the accused has failed to repay the cheque amount despite service of legal notice, thus, he is guilty of commission of offence u/s 138 N.I Act.
26. Keeping in view the aforesaid discussions, this court does not find any infirmity in the order passed by learned MM. and holds that the appellant has been rightly convicted u/s 138 N.I Act. Hence, the present appeal is liable to be dismissed and accordingly, the same Digitally signed by is dismissed.
AJAY GUPTA
AJAY Location:
Karkardooma Courts
GUPTA Complex, Court No.1
Date: 2021.03.26
12:37:53 +0530
(Ajay Gupta)
Addl. Session Judge5
KKD Courts/East/26.03.2021
Announced in open
court on 26.03.2021
Cr. Appl No.96/19 Manoj Tiwari vs State 35 of 35