Delhi District Court
Paramjeet Singh vs . Chanchal Singh Chawla on 21 March, 2018
IN THE COURT OF SHRI SUNIL GUPTA, M.M (CENTRAL): TIS
HAZARI COURTS, DELHI
CC No. : 524010/16
U/s : 138 NI Act
P.S : Pahar Ganj
Paramjeet Singh Vs. Chanchal Singh Chawla
JUDGEMENT
1. Sl. No. of the case : 524010/16
2. Date of institution of the case : 11.07.2012
3. Name of complainant :Sh. Paramjeet Singh S/o
Shri. Sadar Singh, R/o B-60,
Second Floor, Moti Nagar,
New Delhi-110015
4. Name of accused, parentage
& address :Sh. Chanchal Singh Chawla
S/o Sh. Gurbax Singh
Chawla, R/o 6/10, Second
Floor, Old Rajinder Nagar,
New Delhi.
5. Offence complained of
or proved : 138 N. I. Act
6. Plea of accused : Accused pleaded not guilty
7. Final order : Acquittal
8. Date of which order was
reserved : 21.03.2018
9. Date of pronouncement : 21.03.2018
CC No. 524010/16 1/11 Paramjeet Singh Vs. Chanchal Singh Chawla
BRIEF REASONS FOR THE DECISION OF THE CASE
1. Briefly stated the facts as per the complaint are that the accused was well acquainted and personally known to the complainant. He was having good cordial relations with him. Accused approached the complainant in the first week of June, 2011 and requested the complainant that he was in dire need of money for purchase of property in Rajinder Nagar and requested to advance him a friendly loan of Rs. 5,00,000/-. The accused promised to repay the said loan amount within a period of six months time. The complainant advanced the said loan amount of Rs. 5,00,000/- in cash to the accused which was duly received by him in the presence of the marginal witnesses. After completion of six months when the complainant made demand of return of the said loan amount, the accused issued two cheques in the sum of Rs. 2,50,000/- (each) drawn on Ramgarhia Co-operative Bank Limited, Pahar Ganj, New Delhi. When the said cheques were presented by the complainant in his bank i.e. South Indian Bank Ltd, Karol Bagh Branch for encashment, same were returned vide returning memos dated 02.05.2012, with the remarks "Funds Insufficient". Thereafter, complainant served a legal demand notice dated 25.05.2012 to the accused through registered A.D. cover and courier, at his address. The legal notice was duly received but despite that no payment was made. So, present case was filed under Section 138 Negotiable Instruments Act.
2. On the basis of pre-summoning evidence, accused was summoned for the offence u/s 138 Negotiable Instrument Act vide order dated 14.08.2012. Accused put his appearance on 02.02.2013 and thereafter, a notice under Section 251 Cr.P.C was framed against him on 06.06.2014 to which he pleaded not guilty and claimed trial.
3. The complainant adopted his pre-summoning evidence. Complainant has relied upon the documents i.e the original cheque in CC No. 524010/16 2/11 Paramjeet Singh Vs. Chanchal Singh Chawla question i.e. cheque bearing no. 081479 and 081480 in the sum of Rs. 2,50,000/- (each) dated 05.03.2012 drawn on Ramgarhia Co-operative Bank Limited (Ex.CW1/A and Ex.CW1/B respectively), returning memos dated 03.05.2012 Ex.CW1/C (colly.), legal notice dated 25.05.2012 Ex.CW1/D, Postal receipts Ex. CW1/E. He has been duly cross- examined by Ld. Defence counsel. Thereafter, CE was closed by the complainant.
4. After conclusion of post-notice evidence, the statement of accused was recorded under Section 313 Cr.P.C wherein accused stated that he was innocent. He has stated that the complainant used to work as an accountant with in laws of his son. His son's father-in-law also referred him to write and manage his account. He has further stated that the complainant in the course of his employment retained some duly signed cheques and documents with malafide intention to misuse. He had lodged a complaint in the month of August 2011 before SHO PS DBG Road about loss and misplace of his duly signed cheques and documents. He has further stated that in the year 2012, he came to know from the Court summons that the said lost cheques were used by the complainant with the malafide intention. His son's father-in-law committed suicide due to the complainant as he had malafidely misused the duly signed cheques which were stolen by the complainant in the course of his employment at the office of his son's father-in-law. He has further stated that wife and son of the complainant has also filed cheque bounce cases against him which were pending before Tis Hazari Courts. He further stated that there was no legal liability against him.
Thereafter, one witness Sh. Grumeet Singh (son of the accused) was examined by the accused in his defence as DW1. He has deposed as under:
"The accused is my father against whom the cheque case has been filed against him. The complainant has also filed the cheque case against my father in law Late Sr. Ajeet Singh. The complainant was employee under the employment of my father in law and he was introduced by my father CC No. 524010/16 3/11 Paramjeet Singh Vs. Chanchal Singh Chawla in law to the accused. The complainant's wife and son have also filed the cheque case against my father and mother. The property no. 6/32, Ground Floor, Old Rajender Nagar, Delhi was purchased by me with the aid of funds given by my maternal grandfather. The complainant also harassed my father in law due to which he committed suicide". He was duly cross examined by Ld. Counsel for complainant.
5. Arguments heard.
Now Section 138 Negotiable Instrument Act provides as under :-
Dishonour of cheque for insufficiency, etc., of funds in the account- Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, or any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provisions of this Act, be punished with imprisonment for [ a term which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this Section shall apply unless--
i) 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;
ii) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
iii) the drawer of such cheque fails to make payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
So the perusal of the Section shows that complainant has to prove following things in order to prove his case :-
i) the cheque was drawn by the accused for payment of due amount to the complainant;
CC No. 524010/16 4/11 Paramjeet Singh Vs. Chanchal Singh Chawla
ii) the amount was due on the part of the accused for discharge of any legally enforceable debt or other liability;
iii) the cheque was returned dishonoured;
iv) the legal notice was given to the accused within stipulated period;
v) even after the receipt of the legal notice, the accused chose not to make the payment.
Ld. Counsel for the complainant has submitted that the complainant has satisfied and proved all the ingredients of the offence under Section 138 Negotiable Instrument Act. He has further submitted that presumptions under Section 118 & 139 Negotiable Instrument Act are also there and in view of the aforesaid presumptions, the case of the complainant has been proved. The presumptions mentioned above are as under :-
Section 118 Negotiable Instrument Act- Presumption as to negotiable instruments. Until the contrary is proved, the following presumptions 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;
b) as to date-- that every negotiable instrument bearing a date was made or drawn on such date;
c) as to time of acceptance--that every accepted bill of exhange was accepted within a reasonable time after its date and before its maturity;..........
Section 139 Negotiable Instrument Act- Presumption in favor of holder.-- It shall be presumed, unless the contrary is proved, 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, or any debt or other liability.
Ld. Counsel for the complainant has argued that the signature on cheques in question and receipt of legal notice are not disputed by the defence. It has also been argued that no probable defence has come on record, so the case of the complainant virtually CC No. 524010/16 5/11 Paramjeet Singh Vs. Chanchal Singh Chawla remains unrebuted. Further, nothing substantial has come on record by way of testimony of DW-1 Sh. Gurmeet Singh and no other defence witness was examined by the accused. He has prayed for conviction of the accused. Reliance has been placed on the Judgment of Hon'ble Supreme Court of India titled as "Rangappa Vs. Mohan AIR 2010 SC 1898".
Ld. Defence counsel on the other hand has argued that the case of complainant is full of contradictions. It has been submitted that the complainant has miserably failed to show that he was having the amount of Rs. 5 lacs with him at the relevant point of time so as to hand over the same to the accused herein. It has also been argued that exact date on which the amount was so paid to the accused has not been disclosed and no marginal witness as mentioned in para no. 5 of the affidavit have been examined as no such transaction ever took place. Lastly, it was argued that both the cheques were dated 05.03.2012 and in case, accused had handed over the same to discharge his liability then either he could have issued single cheque of the entire amount or he would have mentioned different dates on both the cheques. He has prayed for acquittal of the accused. Reliance has been placed on the Judgment of Hon'ble Supreme Court of India titled as "M.S. Narayana Menon Alias Mani Vs. State of Kerala & Anr. (2006) 6 SCC 39".
It is to be seen that the signature on cheques in question and the receipt of legal notice by the accused has not been disputed. The defence of the accused was that no such amount of Rs. 5 lacs was ever taken by him from the complainant herein. Complainant was stated to be working as part time account with father-in-law of son of the accused and during that period, he came into possession of cheques in question which were later on misused. It is to be seen that no document or any other material has been placed on record by defence to show that the complainant was so working as Accountant with Mr. Ajeet Singh (now expired), father-in-law of Mr. Gurmeet Singh (son of the accused). Even if, it is presumed that the complainant was CC No. 524010/16 6/11 Paramjeet Singh Vs. Chanchal Singh Chawla so working with him, it is beyond comprehension as to how the signed cheques of the accused herein came into his possession. Although, accused stated in his statement u/s 313 Cr.P.C. that father in law of his son referred the complainant to him to manage his accounts also but same cannot be termed as evidence in view of observations of Hon'ble Delhi High Court in a Judgment titled as "V.S. Yadav Vs. Reena" dated 21.09.2010. Also, as per the submissions / statement of accused under section 313 Cr.P.C. recorded by Ld. Predecessor on 17.05.2017, he had lodged a complaint before SHO, PS DBG Road about loss of duly signed cheques and documents but no efforts were made to prove any such complaint. Further, DW-1 Sh. Gurmeet Singh has not stated anything in his examination-in-chief about cheque in question except that the complainant was an employee under his father-in-law and that his father-in-law committed suicide due to harassment by him. In his cross-examination also, he stated that he got to know in the year 2010 that entire cheque book belonging to his father had been stolen. He also stated that this fact about the cheques having been stolen was told to him by his father meaning thereby he was a hearsay witness and was not having any personal knowledge of transactions between the parties, if any. So, the defence evidence led by the accused is not convincing and is hereby rejected.
Having said so, it is to be seen that the accused was not required to adduce any conclusive positive evidence to rebut the presumption existing in favour of complainant. The scope of the statutory presumptions in favor of the complainant as existing in the Negotiable Instruments Act, 1881 and the evidence required to rebut the same has been explained by Hon'ble Supreme Court of India the judgment titled as Krishna Janardhan Bhatt vs. Dattatrya G.Hegde 2008 ( 1) RCR(Crl.) 695 as under :
"we are not oblivious of the fact that the said provision has been inserted to regulate the growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters and to safeguard the faith of the creditor in the drawer of the cheque which is essential to the economic CC No. 524010/16 7/11 Paramjeet Singh Vs. Chanchal Singh Chawla life of a developing country like India. This, however, shall not mean that the Courts shall put a blind eye to the ground realities. Statute mandates raising of presumption but it stops at that. It does not say how presumption drawn should be held to have rebutted. Other important principles of legal jurisprudence, namely presumption of innocence as human rights and the doctrine of reverse burden introduced by Section 139 should be delicately balance. Such balancing acts, indisputably would largely depend upon the factual matrix of each case, the materials brought on record and having regard to legal principles governing the same."
(Emphasis supplied) Further in Kumar Exports vs. Sharma Carpets 2009 II AD (SC) 117, it was held that :-
"...accused in a trial under Section 138 of the Act has two options to rebut the presumptions. He can either show that consideration and debt did not exist or that under the particular circumstances of the case the non-existence of consideration and debt is so probable that a prudent man ought to suppose that no consideration and debt existed.
To rebut the statutory presumptions an accused is not expected to prove his defence beyond reasonable doubt as is expected of the complainant in a criminal trial. The accused may adduce direct evidence to prove that the note in question was not supported by consideration and that there was no debt or liability to be discharged by him. However, the Court need not insist in every case that the accused should disprove the non-existence of consideration and debt by leading direct evidence because the existence of negative evidence is neither possible nor contemplated.........."
(Emphasis supplied) Standard of proof on an accused as far as his defence in a case under Section 138 N.I. Act is concerned, has been elaborately laid down by Hon'ble Supreme Court of India in Rangappa vs. Mohan (supra) as under (this Judgment has been relied upon by the complainant) :
"Section 139 of the Act is an example of a reverse onus clause that has been included in furtherance of the legislative objective of improving the credibility of negotiable instruments. While Section 138 of the Act specifies a strong criminal remedy in relation to the dishonour of cheques, the rebuttable presumption under Section 139 is a device to prevent undue delay in the course of litigation. However, it must be remembered that the offence made punishable by Section 138 can be better described as a regulatory offence since the bouncing of a cheque is largely in the nature of a civil wrong whose impact is usually confined to the private parties involved in commercial transactions. In such a scenario, the test of proportionality should guide the construction and interpretation of reverse onus clauses and the CC No. 524010/16 8/11 Paramjeet Singh Vs. Chanchal Singh Chawla accused/defendant cannot be expected to discharge an unduly high standard or proof. In the absence of compelling justifications, reverse onus clauses usually impose an evidentiary burden and not a persuasive burden. Keeping this in view, it is a settled position that when an accused has to rebut the presumption under Section 139, the standard of proof for doing so is that of `preponderance of probabilities'. Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
(Emphasis supplied) So, it is settled law that the accused can rely on the material submitted by the complainant to raise his defence.
Defence has questioned the very availability of requisite funds with the complainant so as to give the same to the accused. Doubt has also been raised on the alleged transaction as no specific date of the same has been mentioned by the complainant. It is to be seen that complainant in his cross-examination dated 29.04.2016 was asked a specific question regarding the date on which he had given the money to the accused, to which he replied "As stated in the affidavit, I have given money to the accused around 10 th June, 2011 but not aware regarding the exact date". It appears that no such date has been mentioned in any of the affidavits on record. Hon'ble Apex Court in Vijay Vs. Laxman & Anr. Crl Appeal No. 261 of 2013 has held on the effect of omission to mention the date on which loan was allegedly advanced, as under:
"In the first place the story of the complainant that he advanced a loan to the respondent-accused is unsupported by any material leave alone any documentary evidence that any such loan transaction had ever taken place. So much so, the complaint does not even indicate the date on which the loan was demanded and advanced. It is blissfully silent about these aspects thereby making the entire story suspect. We are not unmindful of the fact that there is a presumption that the issue of a cheque is for consideration. Sections 118 and 139 of the Negotiable CC No. 524010/16 9/11 Paramjeet Singh Vs. Chanchal Singh Chawla Instruments Act make that abundantly clear. The presumption is, however, rebuttable in nature".
(Emphasis supplied) Further, as per an affidavit dated 14.08.2012 filed on behalf of complainant, he has withdrawn the amount in question in cash from his bank account and he has placed on record copy of account statement for the period i.e. 01.05.2011 to 30.06.2011 (Ex.CW1/G). Said account statement appears as pertaining to Paul Enterprises and as per the cross-examination of the complainant dated 24.08.2016, he was proprietor of said firm but surprisingly, no document whatsoever has been placed on record to prove that he was the proprietor thereof. Also, no bank official was summoned to prove the unattested and unsigned copy of account statement. Further, complainant has relied upon six entries (duly highlighted by complainant himself in the copy of statement of account) starting from 07 th June 2011 to 22nd June 2011 to show the availability of funds to the tune of Rs.5 lacs with him. Perusal of the last entry dated 22.06.2011 reveals that same was pertaining to an amount of Rs.1,15,500/- but same was not withdrawn in cash rather the reference to that entry shows that same was pertaining to Remittance. Complainant has failed to explain the said entry and in the absence of that explanation, it appears that complainant was not having enough cash so as to advance the same to the accused. It further makes the case of the complainant doubtful more so when the alleged marginal witnesses were neither specified nor examined to prove the transaction in question. Complainant has failed to disclose the date on which cheques in question were handed over to him by the accused and also, as to why the cheques in question were bearing two different handwritings in two different inks.
Considering the above, the advancement of an amount of Rs.5 lacs by the complainant to the accused as alleged and subsequent handing over of cheques in question to the complainant for discharging said liability, is highly doubtful. It is settled law that in case, two views are possible then the view favourable to accused should be CC No. 524010/16 10/11 Paramjeet Singh Vs. Chanchal Singh Chawla adopted.
Accordingly, accused Chanchal Singh Chawla is hereby acquitted for the offence u/s 138 NI Act.
Announced in the open Court on 21.03.2018 (SUNIL GUPTA ) Metropolitan Magistrate (Central-02),Tis Hazari, Delhi CC No. 524010/16 11/11 Paramjeet Singh Vs. Chanchal Singh Chawla