Delhi District Court
:: vs :: on 11 April, 2018
IN THE COURT OF SHRI SUMEET ANAND
METROPOLITAN MAGISTRATE (N.I. ACT)
PATIALA HOUSE COURTS : NEW DELHI
M/s Tara Machines & Tech Services Pvt. Ltd.
Having its Registered office At
B-32, Tara Crescent,
Qutab Institutional Area,
New Delhi - 110016 ................. Complainant
::Versus::
1. M/s Pradeep Kumar
Through its proprietor,
Village Seens, Post mawana
District Meerut -250401
Uttar Pradesh
2. Mr. Pradeep Kumar
Proprietor/Signatory of M/s Pradeep Kumar
Village Seens, Post Mawana,
District Meerut - 250401
Uttar Pradesh ...................Accused
Old Case Number. : 1856/1
New Case Number. : 23571/16
Date of Institution of Case. : 26.06.2015
Offence Complained Of. : 138 NI Act
Plea of the Accused. : Pleaded not guilty
CC No. 23571/16 Page 1 of 34
Arguments Heard On. : 05.04.2018
Final Order. : Convicted
Date of Judgment. : 11.04.2018
:: JUDGMENT ::
1. This judgment shall decide and dispose off Criminal Complaint Case No. 23571/16 (Old CC No. 1856/1) titled as M/s Tara Machines & Tech Services Vs. M/s Pradeep Kumar & ANR. instituted under Section 138 of the Negotiable Instruments Act, 1881 (for short 'N.I Act') for the dishonour of three (3) cheques;
each for a sum of Rs.1 Lakh.
2. Complainant is a company incorporated and registered under the provisions of Companies Act, 1956 dealing in marketing of green technology solutions for building construction, waste recycling and recycled paper production.
3. It is alleged by the complainant that the accused No. 1 M/s Pradeep Kumar being a proprietorship concern, through its sole proprietor Pradeep Kumar, the accused herein, placed a purchase order dated 30.12.2014 with the complainant for supply of TARA Mech. Ram - MX Automatic flyash block making integrated plant (hereinafter Machine). The copy of the Purchase order filed alongwith CC No. 23571/16 Page 2 of 34 the complaint is EX CW 1/3. During the course of cross examination of CW-1, the complainant instead of producing the original Purchase order again placed on record the scanned copy of the same purchase order. It is EX CW 1/C.
4. It is further alleged that the purchase order EX CW1/3 was placed by the accused pursuant to a quotation bearing No. FA/MP/5762 dated 24.12.2014 raised by the complainant. The copy of quotation filed alongwith the complaint is EX CW1/2. During the course of cross-examination of CW-1, the complainant placed on record the office copy of quotation. It is EX CW 1/B.
5. It is also alleged that the total consideration price of the integrated plant / Machine ordered by the accused was Rs. 11,50,000/- (Eleven lakh fifty thousand only) inclusive of all taxes.
6. It is also alleged that pursuant to the purchase order EX CW 1/3 placed by the accused, the complainant raised an invoice No. 1182 dated 31.12.2014 and a challan No. 1436 dated 31.12.2014. The original invoice and challan filed alongwith the complaint are EX CW 1/4(Colly).
7. It is also alleged that the accused, in order to secure the payment of the machine purchased from the complainant issued an indemnity bond dated 30.12.2014 in favor of the complainant. The CC No. 23571/16 Page 3 of 34 copy of the indemnity bond filed alongwith the complaint is EX CW 1/14 (OSR) . During the course of cross-examination of CW-1, the complainant placed on record the original indemnity bond. It is EX CW 1/A.
8. It is also alleged that the Machine was delivered and installed at the premises of the accused. Its installation training was also imparted to the laborers and staff of the accused and the Machinery was commissioned by the complainant at the premises of the accused.
9. It is the grievance of the complainant that the accused in discharge of its liability towards the payment of balance amount of Rs. 3,07,000/- (three lakh seven thousand only) issued the three cheques, detailed hereunder, to the complainant; which upon their presentation were dishonoured and returned unpaid to the complainant vide returning memo dated 29.04.2015 with the remarks "Funds insufficient".
Exhibit Cheque Date Drawn on Amount Date of
No. dishonor
CW1/6 004312 03.02.2015 Union Bank of 1,00,000/- 29.04.2015
India,Hastinapur,
Mawana, meerut
CC No. 23571/16 Page 4 of 34
(UP)
CW1/5 0004313 02.02.2015 -Do- -Do- -Do-
CW1/7 004314 04.02.2015 -Do- -Do- -Do-
10. As the payment for the three dishonoured cheques in question was not forthcoming therefore the complainant set the legal course into motion and issued the statutory legal demand notice dated 11.05.2015, EX CW 1/9 to the accused vide postal receipts EX CW 1/10 (Colly), calling upon him to make the payment of the three dishonoured cheques in question within the prescribed period.
11. It is alleged that the legal demand notice EX CW 1/9 was duly served upon the accused. For proof of service, the complainant has placed on record internet generated tracking report and Acknowledgment card (AD Card) from the postal department. They are EX CW 1/11 (colly).
12. In order to show the liability of the accused towards itself, the complainant has also placed on record its statement of Accounts maintained qua the accused w.e.f. 1st April, 2014 to 31st March 2015. It is EX CW 1/13. Being a computer generated document, for the proof of EX CW 1/13 the complainant has also placed on record a certificate under section 65-B of the Evidence Act. It is EX CW 1/12.
13. It is the grievance of the complainant that despite compliance CC No. 23571/16 Page 5 of 34 of all statutory requirements the accused has failed to make the payment of the three dishonoured cheques in question within the prescribed period. Hence this complaint.
14. On behalf of the complainant this case has been instituted and prosecuted by its authorized representative Ananta Kumar Swain (hereinafter AR) on the strength of a Power of Attorney dated 25.06.2015. it is EX CW 1/1 (Colly). This Power of Attorney is issued in favor of the AR by one Dr. Arun Kumar, Director of the complainant company, on the strength of a Board resolution dated 09.09.2013 passed in his favor; categorically authorizing him to sub- delegate the powers conferred upon him therein. It is EX CW 1/1 (Colly).
15. The AR of the complainant alongwith the complaint filed his evidence by way of affidavit. It is EX CW1/A. Based on the complaint, documents mentioned therein and filed alongwith the complaint and EX CW 1/A the cognizance of the offence was taken and the accused was summoned for offence under section 138 NI Act.
16. Upon the appearance of accused, on 22.01.2016 notice of accusation under section 251 Cr.P.C was served upon him, to which he pleaded not guilty and claimed trial. Accordingly, on the same CC No. 23571/16 Page 6 of 34 date the plea of defence of the accused was also recorded. Simultaneously, the accused moved application under section 145 (2) NI Act, it was allowed and the complainant was recalled for cross examination at the post-summoning evidence stage.
17. The AR of the complainant, at the post-summoning evidence stage was cross-examined as CW-1 at length by the counsel for the accused. No further witness was examined by the complainant in support of his case.
18. Subsequently, the statement of accused under section 313 Cr.P.C was recorded wherein all evidences and incriminating facts appearing against him were put to him affording an opportunity to give his explanation.
19. However, despite opportunity the accused preferred not to lead any defence evidence. Accordingly, after recording his separate statement expressing his unwillingness to lead defence evidence the matter was directly listed for final arguments.
20. This court has perused the entire record and has carefully considered the evidence on record and has taken into consideration the arguments advanced by the contesting parties.
21. Based on the plea of defence raised by the accused, averments made in his application under section 145 (2) NI Act and in his CC No. 23571/16 Page 7 of 34 statement recorded under section 313 Cr.P.C it is undisputed factual position that the three dishonoured cheques in question were voluntarily issued by the accused to the complainant. That they bear the signatures of the accused and that there was an agreement between the parties for supply of machine by the complainant to the accused. However, based upon the same set of proceedings it can also be inferred that the accused has raised various disputes qua his liability towards the complainant.
22. It is worth highlighting herein itself that the plea of defence of the accused when compared with the statement of the accused recorded under section 313 Cr.P.C show a significant deviation / improvement being made by the accused from his plea of defence. At this juncture it shall be beneficial to specifically demarcate the two sets of different defences raised by the accused, i.e. one in his plea of defence read with his application moved under section 145 (2) NI Act; and the second in his statement recorded under section 313 Cr.P.C read with the questions and suggestions put by accused to the AR of complainant during his cross examination as CW-1.
23. The plea of Defence raised by the accused on 22.01.2016 after he pleaded not guilty to the notice of accusation served upon him is as follows;
CC No. 23571/16 Page 8 of 34
"The cheques in question were issued as security only. I have already made the payment against the machines received by me. However, the complainant instead of returning the cheques to me, presented the same for encashment without any intimation to me. The cheques bear my signatures but rest of the particulars were not filled by me. I have no legally enforceable debt or liability towards the complainant. I did not receive any legal demand notice."
24. The relevant portion of the defence as culled out from the application moved by the accused under section 145 (2) NI Act is;
• The complainant has put forwarded a concocted and false story / allegations with contradictory averments and documents.
• Thee accused never issued any cheque in favor of the complainant for the discharge of any legally enforceable debt or other liability.
• The complainant has misused the cheque unlawfully / illegally by procuring it under conspiracy.
• The accused did not receive the statutory
legal demand notice.
25. Now, the improvised story / defence raised by the accused in his statement recorded under section 313 Cr.P.C, which is opposite / alien to his already raised defence is;
"it was in the year 2014, I went to the complainant company for the purchase of the machine of Flyash brick machine. The machine was chown to me and which liked also and was willing to purchase was for a sum of approximately Rs.8 Lacs. Thereafter, I transferred a sum of Rs. 40,000/- in the account CC No. 23571/16 Page 9 of 34 of the complainant company through RTGS. Thereafter, the complainant company called for making the quotation for purchase of machine. The quotation was made in my name Pradeep Kumar. The quotation was made for a sum of Rs. 8,03,000/-. He complainant said that as the price of the machine is high, therefore, either I have to make the payment in cash or I have to give security cheques. Therefore, I issued three cheques for a sum of Rs. 1 Lac each to the complainant, which bear my signatures. These cheques were issued only as security cheques. Thereafter, I also transferred a sum of Rs. 8,03,000/- in the account of the complainant company through RTGS. I also inform the complainant telephonically about making of payment. Accordingly, I asked them that within how much time I will get my machine and refund of Rs. 40,000/- and return of my three security cheques. They assured me that all procedures will be done within 15-20 days. Thereafter, I repeatedly kept calling the complainant, but they kept on extending the time for delivery of machine, return of my security cheques and refund of my advance amount of Rs. 40,000/- . Then I received a summon from the court after which I came to know about this case. The dishonoured cheques in question are the same cheques which were issued by me to the complainant as security cheques qua which I have already made the payments. Thereafter I again contacted the complainant company. They assured me that they will withdraw this case as it has been wrongly instituted. The complainant company has instituted this false case against me with a malafide intention to extort money from me. They are mentally torturing me. They have till date not given the delivery of the machine for which payment has already been made. I have no liability towards the complainant. "CC No. 23571/16 Page 10 of 34
26. Another significant improvement / departure made by the accused in his statement recorded under section 313 Cr.P.C as compared to his plea of defence is that in his statement recorded under section 313 Cr.P.C the accused admits having received the legal demand notice, which in his plea of defence and in his application under section 145 (2) NI Act he denied to have received.
27. It is undisputed that the parties entered into an agreement whereby the complainant had to supply a Machine to the accused. Based on the cross examination of the AR of the complainant it is also undisputed that the complainant received a sum of Rs. 8,43,000/- (eight lakh forty three thousand only) from the accused, once Rs. 40,000/- and then Rs. 8,03,000/-. According to the accused the consideration price of the machine was Rs, 8,03,000/- and he had made the entire payment for its purchase, rather he paid Rs. 40,000/- in excess, but he did not receive the machine from the complainant. Per Contra, the complainant claims that the consideration price of the machine was Rs. 11,50,000 and after receiving a sum of Rs. 8,43,000/- and the three dishonoured cheques in question for Rs. 1 lakh each he delivered, installed and commissioned the machine at the premises of the accused. Now, at CC No. 23571/16 Page 11 of 34 this stage without touching the issue of consideration price of the Machine, this court first proceeds to decide whether the machine as such was delivered to the accused or not.
28. The accused in his plea of defence has categorically admitted to having received the Machine after making its payment. It is not the case of the accused that his plea of defence has been incorrectly recorded. During the entire trial there has been no opposition or challenge by the accused to the contents of his plea of defence. In the opinion of this court, if the accused intends the court to believe his assertions made in his statement recorded under section 313 Cr.P.C of not having received the machines over and above his specific admission made in his plea of defence wherein he categorically admits having received the Machine, then he was under
an obligation to give strong cogent reasons for deviating from his plea of defence duly supported by cogent evidences. However, let alone any evidence, the accused has not even given any cogent reason for deviating from his plea of defence.
29. At this juncture it is relevant to discuss the significance of plea of defence of accused in cases under section 138 NI Act. In a regular criminal trial the accused has a 'Right to Silence' as guaranteed by Article 20 of the Constitution of India. However, it is not the case in CC No. 23571/16 Page 12 of 34 trials for the dishonor of cheque. According to the mandate of law, the accused upon his first appearance before the court, after service of notice of accusation under section 251 Cr.P.C, where he pleads not guilty and claim trial has to make his defence.
30. The Hon'ble High Court of Delhi in the judgment of Ambica Plastopack Pvt ltd & Anr versus State & Anr Crl. M.C. 2698/2011 Decided on 01.11.2013 held;
"XXXXXXXXX 4.4 Onus to prove the defence is on the accused under Section 106 of the Evidence Act, 1872 and it is not violative of Article 21 of the Constitution. 4.4.1 An argument is raised that the accused, under Article 21 of the Constitution of India, has a Right of Silence in a criminal trial and therefore he cannot be forced to disclose his defence. This argument is misconceived in view of section 106 of Indian Evidence Act. Since the offence under section 138 of Ni Act is technical in nature and defence which an accused can take are inbuilt, like the cheque was given without consideration, the accused was not Director at that time, accused was sleeping partner or a sleeping director, cheque was given as a security etc. etc. the onus of proving these defences is on the accused alsone, in view of section 106 of Evidence Act. Since the mandate of legislature is trial of such cases in a summary manner, the evidence already given by the complainant by way of affidavit is sufficient proof of the offence and this evidence is not required to be given again in terms of section 145 (2) of Ni Act and has to be read during the trial."
31. Accordingly, the recording of plea of defence of the accused is CC No. 23571/16 Page 13 of 34 not merely for pleasure sake, it has a specific purpose and an object sought to be achieved. Recording of plea of defence of the accused is in consonance with the principles of fair trial and natural justice which ensure that the complainant is not taken by surprise by the accused during the course of trial and based upon the plea of defence raised by the accused the complainant gets a fair opportunity to duly prove his case and discharge his respective onus of proof.
32. As soon as the accused in his plea of defence admitted having received the machines from the complainant, the onus of the complainant, by virtue of section 58 of the Evidence Act, 1872, to prove the fact of delivery of Machine to the accused stood discharged. For ready reference section 58 of the Evidence Act, 1872 is reproduced herein below;
58. facts Admitted need not be proved.- No fact need to be proved in any proceedings which the parties thereto or their agents agree to admit at the hearing, or which, before the hearing, they agree to admit by any writing under their hands, or which by any rule of pleading in force at the time they are deemed to have been admitted by their pleadings:
Provided that the court may, in its discretion, require the facts admitted to be proved otherwise than by such admissions.
33. Moreover, the entire complainant's evidence can be taken to have been lead on the premise that the accused has already CC No. 23571/16 Page 14 of 34 categorically admitted having received the Machine from the complainant. In this view the 'Rule of Estoppel' as enumerated under section 115 of the Evidence Act, 1872 also bars the accused from raising a contradictory stand from his previous one during the trial.
For ready reference section 115 of the Evidence Act, 1872 is reproduced herein below;
115. Estoppel.- When one person has, by his declaration, act or omission, intentionally caused or permitted another person to believe a thing to be true and to act upon such belief, neither he nor his representative shall be allowed , in any suit or proceedings between himself and such person or his representative, to deny the truth of that thing.
34. If for a moment it is presumed that the plea of defence of the accused was wrongly recorded; he infact intended that the Machine was not received by him, but unfortunately it was recorded that the Machine was received, even such presumption, in the overall facts and circumstances of this case shall not benefit the accused. It is worth highlighting that the day on which the plea of defence of the accused was recorded on the same day application under section 145 (2) of the NI Act was also moved on behalf of the accused. This application too does not find mention of the fact that despite making the entire payment by the accused to the complainant the Machine CC No. 23571/16 Page 15 of 34 has not been delivered to him. Had this been the true and correct fact, considering the precision of averments and details mentioned in the application moved under section 145 (2) NI Act by the Act, this fact would certainly had been mentioned therein.
35. Furthermore, the assertion of the accused that despite making full payment of the Machine to the complainant he did not receive it is difficult to believe as the accused neither raise this issue with the complainant nor with any law enforcement agency. The accused neither issue any notice to the complainant nor invoked any civil proceedings either for specific performance of contract; or for return of his money. In the opinion of this court any reasonable man placed under the similar circumstances as the accused would have acted differently, unlike the accused; and atleast would have agitated the issue of not having received the machine despite making payment in writing either with the complainant, or with any law enforcing agency.
36. Accordingly, on the basis of the above done discussion this court safely comes to the conclusion that the Machine as agreed between the parties was supplied by the complainant to the accused. This court also safely comes to the conclusion that the specific admission made by the accused in his plea of defence admitting CC No. 23571/16 Page 16 of 34 having received the machine was no inadvertent error, rather the claim of the accused in his statement recorded under section 313 Cr.P.C of not having received the Machine is an afterthought and material improvement by him in his defence which lacks support of any cogent evidence and logical reasoning.
37. Another pertinent dispute raised by the accused is with respect to the consideration price of the Machine. The complainant alleges the total consideration price of Machine to be Rs. 11,50,000/-. Per Contra; the accused alleges the total consideration price to be Rs. 8,03,000/-.
38. The complainant in support of his claim has placed on record the 'Quotation' Ex.CW1/2 issued by it to the accused. It also placed on record the 'Purchase Order', placed by the accused Ex.CW1/3. It also placed on record the 'Challan' and the 'Invoice' Ex.CW1/4 (colly). It has also placed on record the 'Indemnity Bond' issued by the accused in favour of the complainant EX CW 1/14 (OSR). Per contra; the accused in order to show the consideration price of the machine to be Rs.8,03,000/- has placed on record copy of one 'Quotation' allegedly issued by the complainant i.e. Ex.CW1/DW-A.
39. A perusal of the 'Quotation' placed on record by the complainant and the one placed on record by the accused show that CC No. 23571/16 Page 17 of 34 they both bear the same Quotation Number and same date. Their contents are also similar except the consideration amount and the manner in which the consideration amount is to be paid. Obviously, the Quotation of the complainant shows the consideration price of machine as Rs.11,50,000/- and the Quotation of the accused shows the consideration price of Machine as Rs.8,03,000/-. According to the Quotation of the complainant the accused had to pay an upfront money of Rs. 8,50,000/- and the remaining amount of Rs. 3 lakhs by way of PDC (Post dated Cheque). However, the Quotation of the accused shows that he had to pay the entire consideration amount of Rs. 8,03,000/- in advance by way of DD (Demand Draft).
40. It is once again reiterated that the AR of the complainant in his cross examination has admitted having received a sum of Rs. 8,43,000/- from the accused. The statement of accounts placed on record by the complainant also reflects having received an amount of Rs. 8,43,000/- in two parts; one for Rs. 40,000/- on 11.12.2014 and the other for Rs. 8,03,000/- on 03.01.2015.
41. The accused in his statement recorded under section 313 Cr.P.C also claims that he first he deposited Rs. 40,000/- and thereafter Rs. 8,03,000/- in the account of the complainant. However, it is worth noting that the accused in his statement also CC No. 23571/16 Page 18 of 34 states that after he deposited a sum of Rs. 40,000/- thereafter he was called upon by the complainant company for making the quotation for the purchase of Machine. Accordingly, the Quotation placed on record by the accused, showing the consideration price of the Machine as Rs. 8,03,000/- was made subsequently after the accused had already paid advance of Rs.40,000/- to the complainant.
42. Now, the question arises, if the accused had already made a payment for a sum of Rs. 40,000/- for purchase of machine then why such amount is not reflected in the Quotation? Why the accused accepted a Quotation omitting the reflection of the amount already paid by him?
43. Even if it is presumed that the Quotations, as a matter of practice, reflect the total consideration amount only, yet another question which arises is that when the accused had already paid a sum of Rs. 40,000/- towards the consideration price of the Machine, which according to him was Rs. 8,03,000/- then why he deposited a further sum of Rs. 8,03,000/- with the complainant when his liability was reduced to Rs. 8,03,000/- minus 40,000/- i.e. Rs. 7,63,000/-.
44. According to the normal / natural course of events / business transactions, when a person had already made an advance payment CC No. 23571/16 Page 19 of 34 towards the consideration price of a thing purchased then while making the remaining payments the deductions of the advance already paid had to be made at the end of the purchaser, the accused in this case, only and making of a surplus payment and then seeking its refund is out of context and not a natural course of events / business transactions.
45. Considering the defence raised by the accused in his statement recorded under section 313 Cr.P.C, he has not given any logical reasoning for making surplus payment to the complainant. Accordingly, a rational view on the conduct of the accused suggests that he did not pay any surplus amount, rather what he paid was actually a payment towards the consideration amount of the Machine only.
46. The complainant initially filed a copy of the 'Quotation' reflecting the consideration price of the Machine as 11,50,000/-. The AR of the complainant in his cross-examination admitted having the original of the Quotation. Subsequently, he produced the office copy of the quotation. It was taken on record and it is EX CW 1/B. It was suggested by the accused during the trial that the 'Quotation' of the complainant is a forged document, a suggestion which was specifically negated. Hence, the onus was on the accused to disprove CC No. 23571/16 Page 20 of 34 the Quotation filed by the complainant. For this the accused was under obligation to lead evidence. However, for true and correct reasons known to the accused he did not lead any defence evidence. However, he merely placed a copy of Quotation showing the consideration price of the Machine to be 8,03,000/-.
47. A Quotation is practically an invitation to offer made by the seller to a prospective buyer. Hence, a quotation is a document given by the seller to a prospective buyer to make an offer for purchase. Therefore, it is certain that a quotation in this case would be given to the accused. However, the accused has not produced the original Quotation issued to him, but has produced only a copy thereof. The accused has not given any cogent reason for not producing the original Quotation, which in the opinion of this Court, based on the natural course of events / business transactions, must have been held by him.
48. The complainant in order to prove the consideration price of the Machine has also placed on record a Purchase order. It allegedly bears the signatures of the accused. The AR of the complainant during his cross-examination admitted having the original Purchase order, however, despite opportunity he did not place the same on record. This court is of the considered opinion that the original CC No. 23571/16 Page 21 of 34 purchase order would be in the possession and control of the complainant, yet it did not produce it. Accordingly, the Purchase order being a photocopy, without any application for secondary evidence cannot be looked into. Therefore, no reliance is being placed on the Purchase order.
49. The complainant in order to prove the consideration price of the Machine has also placed on record the original Indemnity bond issued by the accused in favour of the complainant. It manifestly records the consideration price of the Machine to be Rs. 11,50,000/-. The contents of the Indemnity bond further substantiate the averments and claims made by the complainant in his complaint.
50. In exercise of powers conferred under section 73 of the Evidence Act, 1872 this court has compared the alleged signatures of the accused on the Indemnity bond with his signatures appearing on the court file, such as on the Notice of Accusation, on his Bail Bonds. After a comparison this court is of the considered view that the signatures on the Indemnity bond are of the accused only and none other. For ready reference section 73 of the Evidence Act is reproduced herein below;
73. Comparison of signature, writing or seal with others admitted or proved.--In order to ascertain whether a signature, writing or seal is that of the CC No. 23571/16 Page 22 of 34 person by whom it purports to have been written or made, any signature, writing, or seal admitted or proved to the satisfaction of the Court to have been written or made by that person may be compared with the one which is to be proved, although that signature, writing, or seal has not been produced or proved for any other purpose.
The Court may direct any person present in Court to write any words or figures for the purpose of enabling the Court to compare the words or figures so written with any words or figures alleged to have been written by such person. 1[This section applies also, with any necessary modifications, to finger-impressions.]
51. Although, the issue of the Indemnity bond being not signed by the complainant, or by any witness has neither been raised by the accused during the trial, nor during the course of the final arguments, however, as this court has taken the Indemnity bond into consideration it is necessary to deal with the issue of its non-signing by the complainant or any witness.
52. The Indemnity bond bearing signatures of the accused has been placed on record by the complainant. The stamp paper on which the indemnity bond is made, according to the endorsements made on it, has been purchased in the name of the accused. The accused for true and correct reasons known to him has not lead any defence evidence. As such he has not summoned the concerned stamp vendor to disprove the fact that the stamp paper on which the CC No. 23571/16 Page 23 of 34 Indemnity bond is made was not purchased by him. Moreover, the stampings on the stamp paper suggest that it has been purchased from Mawana, Meerut, Uttar Pradesh which is the residential address of the accused. It is also not the case of the accused that a Stamp paper purchased by him was lost. Henceforth, considering the fact that the stamp paper on which the Indemnity bond is made was purchased by the accused and it bears the signatures of the accused, this court safely comes to the conclusion that the Indemnity bond, as placed on record by the complainant was made and issued by the accused.
53. As far as the issue of non signing of the Indemnity bond by the complainant and any witnesses is concerned, this court is of the opinion that such non signing may at best prevent the complainant from claiming the legal ramification flowing out of it. However, it cannot be ignored for the averments made therein. It might not be used to the advantage of the complainant where he seeks redressal based on this Indemnity bond. However, being a document made by the accused there is no impediment in using this document against the accused, insofar as it disputes / contradicts his own case.
54. Based on the abovedone discussion and taking into account the fact that the accused has made more payment to complainant, CC No. 23571/16 Page 24 of 34 without any valid reason, than the consideration amount of the machine as alleged by him; also taking into account the contents of the indemnity bond which clearly show the consideration price of the Machine to be the same as claimed by the complainant, but not as alleged by the accused, this court safely comes to the conclusion that the total consideration price of the Machine agreed to sold by the complainant to the accused was Rs. 11,50,000/-, nut not as alleged by the accused.
55. As this court has concluded that the consideration price of the machine was Rs. 11,50,000/- and as it is undisputed that till date the accused has paid only a sum of Rs. 8,43,000/- to the complainant, accordingly, the three dishonoured cheques in question are the ones issued by the accused to the complainant in discharge of his liability for the remaining balance amount.
56. The accused has raised another defence of the dishnoured cheques in question being security cheques for having been issued blank but only signed by the accused to the complainant. With respect to this defence of the accused it is immaterial whether the dishonoured cheques in question were issued before the delivery of Machine or thereafter. It is also immaterial whether the dishonoured cheques, when they were issued were a choate or an inchoate CC No. 23571/16 Page 25 of 34 instrument. It is admitted that all the dishonoured cheques in question bear the signatures of the accused and the cumulative amount filled therein has been concluded to be outstanding and payable by the accused to the complainant. In this view, by virtue of section 20 of the NI Act, even if the complainant made the signed inchoate instrument to a choate instrument by filling the blanks therein, the complainant acted within the his rights as mandated by section 20 of the NI Act. For ready reference section 20 of the NI Act is reproduced herein below;
"20. Inchoate stamped instruments.- Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in [India], and wither wholly blank or having wwritteen theereon an incomplete instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the case may be, upon it a negotiable instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount: provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder".
57. The accused has raised one more defence that he did not receive the legal demand notice. At the outset it is pertinent to note CC No. 23571/16 Page 26 of 34 that with respect to receiving of legal demand notice accused has taken contradictory stands. In his plea of defence he claims that he did not receive the notice, but in his statement recorded under section 313 CrPC he states to have received the legal demand notice. It is the settled proposition of law that if the statement made by an accused contains of two parts i.e an inculpatory part and an exculpatory part then such of his statement can be breaken up into two parts and the inculpatory part can be used against the accused, however, with respect to the exculpatory part the onus rests on the accused to prove it. For instance where the accused says that, 'I killed X in the right of my private defence' herein I killed X is an inculpatory statement which can be used against the accused if he fails to prove the exculpatory part that he killed X in exercise of right to private defence.
58. In this view, when the accused in his statement recorded under section 313 CrPC states that he has received the legal demand notice then the same stands admitted and this fact can be taken against the accused. Moreover, the Hon'ble Supreme Court in the judgment of Ram Naresh Vs. State of Chattisgarh (2014) 4 SCC 257 held that where the accused exercise his right under section 313 CrPC and gives an explanation to the incriminating facts CC No. 23571/16 Page 27 of 34 appearing against him, then his answers, insofar as they support the case of the prosecution can be used against him. Therefore, it can be safely presumed that the accused received the legal demand notice as sent by the complainant.
59. The contradictory stands taken by the accused during the course of the trial squarely bring his case under the cloud of doubt that either he is trying to hide some facts or is trying to manipulate the facts by improvising on every different stage of trial. The accused had a fair opportunity to lead defence evidence evidence and substantiate the facts alleged by him, however, for true and correct reasons known to be accused he did not prefer to lead any defence evidence by not entering the witness box himself or by leading cogent defence evidence any statement made by the accused has been renderred open to be used against him, if it contradicts his case. However, nothing stated without leading any defence evidence can be seen, read or interpreted in favour of the accused. The Hon'ble High Court of Delhi in the judgment of V.S. Yadav Vs. Reena Crl. A. No. 1136 of 2010 decided on 21.09.2010 held;
5. It must be borne in mind that the statement of accused under Section 281 Cr. P.C. or under Section 313 Cr. P.C. is not the evidence of the accused and it cannot be read as part of evidence. The accused has an option to examine himself as a witness. Where CC No. 23571/16 Page 28 of 34 the accused does not examine himself as a witness, his statement under Section 281 Cr. P.C. or 313 Cr. P.C. cannot be read as evidence of the accused and it has to be looked into only as an explanation of the incriminating circumstance and not as evidence. There is no presumption of law that explanation given by the accused was truthful. In the present case, the accused in his statement stated that he had given cheques as security. If the accused wanted to prove this, he was supposed to appear in the witness box and testify and get himself subjected to cross examination. His explanation that he had the cheques as security for taking loan from the complainant but no loan was given should not have been considered by the Trial Court as his evidence and this was liable to be rejected since the accused did not appear in the witness box to dispel the presumption that the cheques were issued as security. Mere suggestion to the witness that cheques were issued as security or mere explanation given in the statement of accused under Section 281 Cr. P.C., that the cheques were issued as security, does not amount to proof. Moreover, the Trial Court seemed to be obsessed with idea of proof beyond reasonable doubt forgetting that offence under Section 138 of N.I. Act was a technical offence and the complainant is only supposed to prove that the cheques issued by the respondent were dishonoured, his statement that cheques were issued against liability or debt is sufficient proof of the debt or liability and the onus shifts to the respondent/ accused to show the circumstances under which the cheques came to be issued and this could be proved by the respondent only by way of evidence and not by leading no evidence.
6. The respondent in this case took the stand that he had replied to the notice but surprisingly he had not placed on record the copy of his reply. If it is believed that he had sent reply to the notice of the complainant, the copy of that reply must have been retained and could have been easily placed on record CC No. 23571/16 Page 29 of 34 and proved by the respondent. Not placing the copy of reply on record and not proving it, in fact, prove the assertion made by the complainant that instead of sending reply, blank sheets of paper were sent in envelope to the complainant.
7. The respondent has placed reliance on Krishna Janardhan Bhat v. Dattatraya G. Hegde, 2008 Crl. L.J. 1172, which is also the case relied upon by the Trial Court. In this judgment itself Hon'ble Supreme Court has specifically observed that Court should not be blind to the ground realities and the rebuttal of presumption under Section 139 of N.I. Act would largely depend upon the factual matrix of each case. The Trial Court in this case turned a blind eye to the fact that every accused facing trial, whether under Section 138 of N.I. Act or under any penal law, when charged with the offence, pleads not guilty and takes a stand that he has not committed the offence. Even in the cases where loan is taken from a bank and the cheques issued to the bank stand dishonoured, the stand taken is same. Mere pleading not guilty and stating that the cheques were issued as security, would not give amount to rebutting the presumption raised under Section 139 of N.I. Act. If mere statement under Section 313 Cr. P.C. or under Section 281 Cr. P.C. of accused of pleading not guilty was sufficient to rebut the entire evidence produced by the complainant/ prosecution, then every accused has to be acquitted. But, it is not the law. 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 CC No. 23571/16 Page 30 of 34 returned, he would have served a notice as complainant. Nothing was proved in this case.
8. In this case no evidence, whatsoever, was produced by the accused and the Trial Court travelled extra steps, not permitted by law, to presume that the presumption has stood rebutted. I, therefore, set aside the judgment of the Trial Court.
60. Before parting it is also necessary to deal with the challenge put fore by the accused to the authority of the AR of the complainant. It is contended that the AR of the complainant, who has instituted and prosecuted this case on behalf of the complainant on the strength of a Power of Attorney dated 25.06.2015 EX CW 1/1 (Colly) is not duly authorised as his power of attorney which is an outcome of sub-delegation of authority by a director of the complainant is in excess of what the director was himself authorised by the company.
61. The original board resolution dated 09.09.2013 passed by the complainant authorising one Dr. Arun Kumar, a director of the complainant to do certain acts on behalf of the complainant is on record. It is EX CW 1/1 (Colly). It specifically authorises him to sub- delegate his authority. It is in accordance with this power of sub- delegation he has executed the power of attorney dated 25.06.2015 in favour of the AR of the complainant, on the strength of which he CC No. 23571/16 Page 31 of 34 has instituted and prosecuted this case.
62. The challenge of the accused to the competence of the AR of the complainant is based on the maxim Delegatus Non Potest Delegare. It is contended that the person who executed the power of attorney in favour of the AR of complainant to institute and prosecute this criminal complaint case was himself not authorised by the complainant company to institute a criminal comlaint. Accordingly, a power which he himself was lacking, he could not have delegated it to the AR of the complainant.
63. It is contended by the accused that the Board Resolution dated 09.09.2013 merely authorises Dr. Arun Kumar only to manage the affairs of the company, approve expenses, authorize payments, sign all contracts and documents agreements, applications, petitions, affidavits as may be required to be submitted by the company before any Government Authority, tribunal, Local Authorities and enter into agreements with third parties on behalf of the company and represent the company in all other matters incidental thereto as may be considered necessary and expedient. But, it nowhere authorises him to institute a criminal complaint under section 138 NI Act, therefore he could not have sub-delegated this authority to the AR of the complainant.
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64. In the opinion of this court, this court the accused is taking a very narrow interpretation of the board resolution dated 09.09.2013. In the opinion of this court it is wide enough to authorise him to institute and legal proceeding before any government Authority, which certainly includes the courts of law. Hence, the specific / special power of attorney with respect to this case issued in favour of AR of the complainant on the strength of the resolution dated 09.09.22013 is absolutely valid.
65. Another challenge to the power of attorney issued in favour of the AR of the complainant is that it does not bear the signatures to the AR of the complainant. A power of attorney creates a contract of Agency between two persons. Where a power of attorney is executed in favour of a person, he may still refuse to act as the agent of the person executing it. Irrespective of the fact whether the power of attorney bears the signatures of the person who is to act as the agent of the executor, the moment such person acts according to the attorney the Agency is created. In this case the AR in whose favour the power of attorney has been issued has acted thereupon and instituted and prosecuted this case. Hence, merely because the attorney does not bear his signatures is of no consequence, particularly when it is not the case of the complainant that the AR is CC No. 23571/16 Page 33 of 34 the same person in whose favour the attorney was executed.
66. Accordingly, based on the above done discussion this court is of the opinion that the three dishonoured cheques in question were issued by the accused in discharge of his liability towards the balance payment of consideration price of a Machine purchased by him from the complainant. However, owing to their dishonour due to insufficiency of funds and failure of the accused to make the payment of the dishonoured cheques within the prescribed period despite compliance of all statutory requirements by the complainant, the accused Pradeep Kumar has committed an offence under section 138 of the NI Act. Accordingly, accused pradeep kumar is hereby convicted.
Announced in the Open (SUMEET ANAND)
Court on 11th day of April'18 MM(N.I Act)/PHC/ND
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