Delhi District Court
Findings vs Cc No. 333/ on 16 January, 2014
IN THE COURT OF SH. APOORV SARVARIA, CIVIL JUDGEI, NEW
DELHI DISTRICT, NEW DELHI
C.C. No:333/11
Unique Case ID No. 02403R1013012007
S P Singh
Director of S.B.C. Network India Ltd.
Office At:
810, Shakuntla Building,
59, Nehru Place, New Delhi19.
.....Complainant
Versus
Man Singh Chaudhary
Director of M/s. M.M.A Marketing Pvt. Ltd.
R/o. S43, Saurabh Vihar,
Badarpur, New Delhi.
.....Accused
COMPLAINT UNDER SECTION 138 OF THE
NEGOTIABLE INSTRUMENTS ACT, 1881
Date of Institution: 14.09.2007
Date of Reserving Judgment: 07.10.2013
Date of Judgment:16.01.2014
JUDGMENT
Brief facts
1. The brief facts of the present complaint filed under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as "NI Act") are that the complainant Sh. S P Singh is the Director of M/s. SBC Network India Ltd. which develops a software and is doing its business at Nehru Place, New Delhi. The accused Sh. Man Singh Chaudhary is stated to be the Director of M/s.
CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 1 of 8MMA Marketing Pvt. Ltd. and doing his business at Badarpur, New Delhi.
2. It is stated that the accused was taking service of software development charges for the multilevel marketing and accounting and inventory management with source code for the company from the complainant company and the complainant raised a bill of Rs. 15,48,500/.
3. The accused had issued post dated cheque bearing no. 576660 dated 04.04.2007 for Rs. 15,48,500/ drawn on Central Bank of India, Badarpur, New Delhi as payment against the bill. The cheque was presented and was returned unpaid with remarks "funds insufficient" vide memo dated 10.07.2007. Thereafter, the complainant issued legal notice dated 01.08.2008 to the accused through registered AD. It is stated that despite receipt of the legal notice, the accused has failed to pay the cheque amount to the complainant within the prescribed period. Therefore, it is stated that the accused has committed the offence under Section 138 of the NI Act.
Proceedings Before Court
4. The present complaint was received by way of assignment on 17.09.2007. Ld. Predecessor issued summons against the accused. The accused entered appearance and notice of accusation was framed against the accused on 27.07.2010 to which he pleaded not guilty and claimed trial.
5. In support of his case, the complainant produced himself as CW1 and tendered his affidavit in evidence Ex.CW1/G. He also relied upon the documents Ex.CW1/A to Ex.CW1/F. Thereafter, CW1 Sh. S P Singh was crossexamined and was discharged after which the complainant closed his evidence.
6. During the examination conducted under Section 313 of Cr.P.C., the accused stated that he had not issued any cheque to the complainant Sh. S P Singh. He further stated that total five cheques bearing no. 576656, 576657, 576658, CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 2 of 8 576659 and 576660 alongwith his photograph, ration card, PAN card, one diary when ICard were missing on 06.12.2006 from the office of Green Life India Ltd. and he was working as a partner with Sh. S P Singh at Nehru Place, New Delhi. The above said cheques were signed by him and the name and amount were not filled by him. He further stated that the cheques were issued for the purpose of financing of a car. A missing report was given to the police on 15.12.2006. He further stated that the complainant Sh. S P Singh alongwith Sh. K N Sharma and his real brother Sh. D P Singh contacted him during the month of September, 2006 in his office at MMA Marketing Pvt. Ltd. Badarpur, New Delhi, the complainant told him that he is going to start a company in which these three persons who came to visit accused and the accused would be partners of equal share. He further stated that the complainant informed him that he and Sh. K N Sharma will look after the field job and the accused will be paid a salary of Rs. 35,000/ per month and a car make Ford Fiesta will be given to the accused but instalments will be paid by the company Green Life India Pvt. Ltd. and MoU was signed to this effect. Then, the complainant Sh. S P Singh asked him to hand over five cheques for the finance of the abovesaid car. The accused stated that he issued five cheques alongwith photograph, copy of ration card and I Card to him. The same process was for Sh. Pramod Kumar Rana and Sh. Rajpal Singh. The complainant Sh. S P Singh asked the accused to issue five more cheques for financing of the said car stating that whichever finance company will do it early, other cheques will be returned to him. On 06.12.2006, the diary alongwith five cheques were missing from the office of Green Life India Ltd. out of which one cheque is in question in the present complaint. After making search for the above said lost articles, the accused is stated to have made a complaint to the police on 15.12.2006. Regarding the finance of the car, he further stated that in his examination that Sh. S P Singh CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 3 of 8 had told him that Green Life India Ltd. is a new company and not having sufficient money and car will be financed from the complainant's company namely, SBC Network India Ltd. Ford Fiesta car was financed on 29.12.2006 on the basis of SBC Network India Ltd. At that time, the work of Green Life was already in progress. The accused has further stated that in the month of December, 2006 he had asked for his salary for the month of October, November and December. Then Sh. S P Singh told him that there is no fund in the company and the accused had to spend money from his pocket. In the month of January, 2007, accused asked for the instalment of the car and salary but same reply was given. The accused has stated that he has spent Rs.65,000/ already. In the month of February, 2007, he gave a written application that he will not work as a Director and will work as field worker. In March 2007, he stopped coming to the company. In the last week of March 2007, Sh. S P Singh, Sh. K N Sharma and Sh. D P Singh came to his office at M/s. MMA Marketing Pvt. Ltd., Badarpur, New Delhi having made a deed which was signed by the abovesaid three persons but the accused refused to sign. After that, out of five lost cheques, one cheque which is in question is against him. He also stated that the complainant filed so many other cases against Sh. Pramod Kumar Rana and Sh. Rajpal. He also stated that the complainant has PAN cards and credit cards with different names and addresses and he is cheating in the same way others also.
7. In support of his defence, accused has produced DW1 Sh. Pramod Kumar Rana who was examined in chief and thereafter cross examined. The accused has also produced himself as DW2 and examined himself in chief and thereafter cross examined. Thereafter, DE was closed.
8. This court has heard Ld. Advocates for complainant as well as accused and perused the record.
CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 4 of 8Findings
9. This court has heard learned Advocates for the complainant and the accused and perused the record. The signature on the cheque no. 576660 dated 04.04.2007 for Rs. 15,48,500/ is not disputed. Therefore, the execution of cheque is not disputed. Hence, the presumption under Section 139 of the NI Act is raised.
10.In Rangappa v. Sri Mohan AIR 2010 SC 1898 it was observed by the Hon'ble Supreme Court as under :
"14. In light of these extracts, we are in agreement with the respondentclaimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability. To that extent, the impugned observations in Krishna Janardhan Bhat (supra) may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it was based on the specific facts and circumstances therein. As noted in the citations, this is of course in the nature of a rebuttable presumption and it is open to the accused to raise a defence wherein the existence of a legally enforceable debt or liability can be contested. However, there can be no doubt that there is an initial presumption which favours 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 CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 5 of 8 interpretation of reverse onus clauses and the 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 and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own. " (emphasis added)
11. Therefore, in view of the decision of the Supreme Court in Rangappa, it is clear that the presumption raised under Section 139 of the NI Act is of legally enforceable debt. However, the accused can rebut the said presumption by raising a probable defence
12.First of all, the present complaint has been filed by Sh. S P Singh. However, the payee of the cheque Ex.CW1/B is not Sh. S P Singh but SBC India Network Pvt. Ltd. The present complaint has been filed by Sh. S P Singh stating himself to be the Director of the payee. However, the fact remains that the payee is not the complainant. Therefore, the present complainant Sh. S P Singh has no locus to file the present complaint under Section 142 of NI Act as the same has not been filed by the payee or holder in due course of the cheque The complaint is not maintainable and is liable to be dismissed on this ground alone.
13.In the present complaint, the defence of the accused has been that the cheque in question was one of the five cheques taken for getting a vehicle financed which was done through Green Life India Pvt. Ltd. and the complainant has misused the said cheques.
14. In support of his defence, the accused has produced DW1 Sh. Pramod Kumar CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 6 of 8 Rana who has deposed that he had joined Green Life India Pvt. Ltd and was approached through Sh. Man Singh by Sh S P Singh, Sh. B P Singh and Sh. K M Sharma. He stated that he received Indica Car and the accused had received Ford Fiesta. He also deposed that he had given five blank cheques for getting the vehicle financed. He also deposed that the accused had also given five blank cheques to Sh. S P Singh. DW1 also deposed that Sh. S P Singh told him that his five cheques were lost and he was asked to give five more cheques. Likewise, the accused was told to give five more blank cheques on the pretext that the particular bank is not financing the Ford Fiesta. Sh. S P Singh prepared salary slips of SBC Network India Ltd showing DW1 Sh. Pramod Kumar Rana and the accused as employees. The salary slips are Ex.DW1/A, Ex.DW1/B, Ex.DW1/C and Ex.DW1/D. He also deposed that the additional five cheques were given by the complainant to the accused in the office of Green Life India Ltd. The accused had registered FIR against the misuse of cheques. This testimony of DW is corroborated by the accused himself. Accused has deposed as DW2 in his examination in chief that the complainant took five blank undated cheques bearing only his signatures for getting the vehicle financed from ICICI Bank. Before the vehicle could be financed from ICICI Bank, the complainant asked him to hand over five more blank cheques so that vehicle could be financed from HDFC bank. The complaint filed by DW2 Sh. Man Singh Chaudhary to SHO PS Badarpur on 15.12.2006 was relied upon as Ex.DW2/D. Considering the material on record and the evidence adduced by the accused, this court finds that the accused has been able to raise a probable defence that the cheque no. 576660 Ex.CW1/B is one of the cheques which was stolen/lost in the office of Green Life India Ltd. Looking at the cheque Ex.CW1/B, the writing by which the signature on the cheque has been made by the accused and the writing by which payee's name and amount has been CC No. 333/11 S P Singh v. Man Singh Chaudhary Page 7 of 8 written are very different and do not appear to be made by the same person. These facts further strengthen the defence of the accused that he had not issued the cheque to the complainant and it was stolen/missing from the office of Green Life. The complaint dated 15.12.2006 Ex.DW2/D to the SHO, PS Badarpur also shows that the accused had filed a complaint in respect of the cheque.
15.Since the accused has rebutted the presumption raised U/s. 139 of the NI Act, the onus shifts on the complainant to prove his case beyond reasonable doubt that the cheque was issued in discharge of legally enforceable debt or liability. (See Pine Product Industries v. R P Gupta 2007(94) DRJ 352). However the complainant has not filed any document to prove that the cheque was issued for taking service of the software development charges for multiple level marketing and accounting and inventory management. The invoice Ex.CW1/A relied by the complainant witness appears to be made under dubious circumstances as it has been raised towards Sh. S P Singh Director of MMA Marketing. Had there been any transaction between SBC Network and MMA Marketing Pvt. Ltd. in respect of the cheque in question, the invoice should have been addressed directly to MMA Marketing Pvt. Ltd. and not Sh. Man Singh Chaudhary who is accused in the present case. In such doubtful circumstances, the complainant has not been able to prove his case. The complaint is dismissed. Accused is acquitted. Bail bonds stand cancelled. Surety is discharged. File be consigned to record room. Judgment be uploaded to www.delhidistrictcourts.nic.in.
Announced in the Open Court (Apoorv Sarvaria)
th
on 16 January, 2014 Civil JudgeI/MM,New Delhi District New Delhi
CC No. 333/11
S P Singh v. Man Singh Chaudhary Page 8 of 8