Delhi District Court
Amit Gulati vs Gopal Krishan on 29 August, 2024
IN THE COURT OF JUDICIAL MAGISTRATE (NI
ACT), NORTH-WEST, ROHINI, DELHI
Presided by :- Ms. Shivangi Vyas
CNR No. DLNW02- 005686-2014
CC No. 15625/2016
Amit Gulati S/o Late Bhushan Lal Gulati
R/o J-22D, MIG Flats, Phase-I,
Ashok Vihar, Delhi-110052
.....Complainant
Versus
Gopal Krishan
S/o Sh. Roop Ram
R/o 26-C, Madipur DDA (Slum & JJ Wing)
Lal Quarter, Delhi-110026
.........Accused
JUDGMENT
(1) Offence complained of : 138 N.I. Act (2) Plea of accused : Pleaded not guilty (3) Date of institution of case : 04.08.2014 (4) Date of reserve of order : 20.08.2024 (5) Date of Final Order : 29.08.2024 (6) Final Order : Acquitted.
BRIEF STATEMENT OF REASONS FOR THE DECISION
1. Vide this judgment, this court shall dispose of complaint under section 138 of Negotiable Instruments Act (hereinafter referred to as 'NI Act') filed by Sh. Amit Gulati (hereinafter referred to as 'complainant') against Sh. Gopal CC No. 15625/2016 Page No. 1 of 24 Shivan Digitally signed by Shivangi Vyas gi Vyas 18:07:49 +05'30' Date: 2024.08.29 Krishan (hereinafter referred to as 'accused').
FACTUAL MATRIX
2. Facts in brief as stated in the complaint are that accused had approached to the complainant for taking friendly loan for a sum of Rupees Three Lakh and complainant gave a loan of Rupees Three Lakh on 27.07.2010. Accused and complainant entered into an agreement executed on 27.07.2010. It is stated that accused promised to the complainant to return the entire loan amount along with interest within thirty-six months but accused failed to repay the said amount. It is further stated that in the month of August, 2013 accused and complainant talked to one another and accused told the complainant that he is not in a position to repay the loan amount borrowed by him and offered to sell his property bearing no. 26-C, Madipur, DDA (Slum & J.J. Wing) Lal Quarter, Delhi-26 for a total consideration of RS.35,00,000/-. It is stated that as per deal the complainant was supposed to pay an amount of Rupees Twenty Three Lakh as earnest money to purchase the property belonging to the accused. This amount of Rupees Twenty Three Lakh included Rupees three lakh which was already paid to the accused as loan amount. It is stated that complainant paid Rupees Twenty Lakh to the accused on 12.08.2013. Rest of the amount of consideration i.e. Rupees Twelve Lakh was to be paid by the complainant at the time of execution of the sale documents by the accused within two months from CC No. 15625/2016 Page No. 2 of 24 Shivan Digitally signed by Shivangi Vyas gi Vyas 18:08:10 +05'30' Date: 2024.08.29 12.08.2013.
3. It is further stated that complainant approached the accused in the first week of October, 2013 for execution of sale documents in favor of the complainant on making payment of Rs. 12,00,000/-, however the accused at this time told the complainant that he was not interested in selling his house and requested and promised to return Rupees Twenty Three Lakh received by accused from the complainant and issued a cheque bearing no. 665822 dated 12.11.2013 amounting to Rupees Nine Lakh Fifty Thousand in favor of the complainant as a part payment and assured the complainant that the same will be honoured. When complainant presented the cheque, same got dishonoured. Complainant was constrained to send a legal notice dated 23.11.2013 through his advocate to the accused calling upon him to pay the amount of cheque within 15 days from receipt of notice, however, despite service, accused failed to pay the amount to the complainant within the stipulated period and therefore, the present complaint has been filed.
4. Complainant tendered his pre-summoning evidence on 20.12.2014 by way of affidavit EX CW1/A and relied upon following documents in his evidence :
Ex CW1/1 : Original Cheque in question. Ex CW1/2 : Bank Return memo dated 18.11.2013 Ex CW1/3 : Speed post receipt Ex CW1/4 : Legal notice dated 23.11.2013 CC No. 15625/2016 Page No. 3 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:08:28 +05'30' Ex. CW1/5 : Tracking report Ex. CW1/6 : Agreement dated 27.07.2010 Ex. CW1/7 : Earnest Money Receipt APPEARANCE OF ACCUSED AND PROCEEDINGS
5. Since prima facie offence u/s 138 of Negotiable Instrument Act was made out, the accused was summoned vide order dated 20.12.2014. Accused entered his appearance and notice was served upon him for offence punishable u/s 138 NI Act on 04.04.2016, to which he pleaded not guilty and claimed trial.
6. In his plea of defense, accused has submitted that the cheque in question was given by him to the complainant as security as he took loan of Rs.3,00,000/- from the complainant about 03-04 years back. He stated that the cheque in question bears his signatures, however contents were not filled by him. It is stated that most of the payment regarding loan alongwith the interest have been made by him to the complainant and now he has liability of Rs.60,000- 70,000/- towards the complainant. Legal notice regarding the cheque in question was received by him, however he cannot say as to whether reply to said notice was given by his counsel or not.
COMPLAINANT EVIDENCE
7. The complainant adopted his pre summoning evidence and placed reliance upon the documents EX CC No. 15625/2016 Page No. 4 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:08:47 +05'30' CW1/1 to Ex CW1/7. An application under section 145(2) NI Act was moved by the accused seeking permission to cross-examine the complainant and the same was allowed by Ld. Predecessor of this court vide order dated 23.11.2016. Complainant was cross-examined by Ld. counsel for accused on multiple dates and right of accused to further cross examine complainant was closed vide order dated 30.01.2018. Thereafter, accused made oral request for calling of complainant which was allowed vide order dated 03.07.2018. complainant was further cross examined and discharged on 29.09.2018. No other witness was examined and complainant evidence was closed vide order dated 27.09.2018.
STATEMENT OF ACCUSED AND DEFENCE EVIDENCE
8. All the incriminating evidence was put to the accused and his statement under section 281 CrPC read with section 313 CrPC was recorded on 06.12.2018. In his plea of defence, accused submitted that he has taken loan of Rs.3,00,000/- in the year 2010 from the complainant and out of which he has returned Rs.2,40,000/- including the interest to the complainant. It is stated that complainant has never issued any receipt regarding the payment made to the complainant in installments. It is further stated that he issued cheque in question alongwith cheque of his son and property papers to the complainant as security when he took the loan from the complainant. Accused admitted that the CC No. 15625/2016 Page No. 5 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:09:04 +05'30' cheque in question bears his signatures, however the contents in the same were not filled by him. It is further stated that the accused and his wife have also signed some blank papers at that time. It is further stated by accused that when he approached the complainant for settling the account an altercation took place with the complainant and the complainant refused to settle the accounts and later misused his cheque and cheque of his son. Accused admitted that the agreement Ex. CW1/6 and receipt Ex. CW1/7 bears his signatures but they were blank when he signed them. Accused claimed that he has a liability of Rs.60,000/- to Rs.70,000/- only and he has lodged a complaint U/s 200 Cr. PC against the complainant.
9. Accused chose to lead DE and examined two defence witnesses. Accused examined himself as DW1. DW1 deposed that he had taken a loan of Rs. 3 Lacs from the complainant as he was ill. DW1 stated that against the said loan he has given his property documents to the complainant who had obtained his signatures on some blank documents which bear a copy of Rs.50 note and ticket were also affixed on that document. It is stated that the complainant had taken two blank signed cheques each from him and his son namely Montu. It is stated that he has already returned Rs.2,65,000/- to the complainant, out of the above stated loan but no written document or receipt was ever given to him by the complainant. It is stated that thereafter, the complainant had filled one cheque each of CC No. 15625/2016 Page No. 6 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:09:19 +05'30' my son and myself for an amount of Rs. 1,90,500/- each and then presented the same before the bank which got dishonoured. It is stated that he has asked the complainant that he has already given him much more amount including interest against the amount which was taken by him as a loan. It is stated that thereafter, a scuffle/heated arguments were happened between him and complainant and thereafter the present case was filed by the complainant against him. It is stated by DW1 that the documents which were initially signed by him were later manipulated by the complainant and used by complainant against him. Thereafter, complainant told him that he had purchased his house for an amount of Rupees Twenty six Lakh but no such amount was ever paid to him by complainant. It is stated that he never had intended to sell his house to anyone. DW1 was cross-examined and discharged on 17.01.2023.
10. Ms. Nisha has examined as DW2. DW2 stated that she knew the complainant and they were in need of money and taken a loan of Rupees Three Lakh from the complainant on interest basis 10-12 years back and they paid the installments on regular basis to the complainant alongwith interest but complainant did not give them any receipt of the same. Complainant had taken the property papers alongwith cheques at the time of giving loan to them for security purposes. Complainant had also taken some blank signed papers from them which bears the ticket. DW2 stated that there was some outstanding amount i.e. CC No. 15625/2016 Page No. 7 of 24 Digitally signed by Shivangi Vyas Shivangi Vyas Date: 2024.08.29 18:09:35 +05'30' Rs.35,000/- and complainant was imposing interest upon the same again and again and asked the complainant to give the receipt of the paid amount and some hot talks were took place at the spot. It is stated that thereafter, complainant has filed a case against them, however they paid interest regularly. Complainant has filed a false case upon them. It is stated that they never talked about sell of their house with the complainant. DW2 duly cross-examined and defence evidence was closed on 09.02.2024.
FINAL ARGUMENTS
11. It is argued on behalf of complainant that complainant has been successful in establishing all the necessary ingredients of offence under section 138 NI Act. It is argued that case of complainant is based on documents. The agreement dated 27.07.2010 is signed by both the parties. The earnest receipt which also contains the signatures of accused and his wife is the receipt regarding the amount of Rs 23,00,000/- received by accused from complainant. The accused had failed to establish that his signatures were taken on blank papers as he did not lead any evidence in this regard. The accused has taken bald defence that his blank signed cheques were taken by complainant. It is argued that the statutory presumption of existence of legal liability lies in favor of complainant and the accused has failed to rebut the same. It is further argued that accused has failed to reply to legal notice despite receiving the same and even the police complaint was filed by accused only CC No. 15625/2016 Page No. 8 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:09:53 +05'30' upon receiving the summons from court in the present complaint. Ld. Counsel for complainant has relied upon the judgment of Hon'ble Supreme Court in Bir Singh vs Mukesh Kumar, Lekh Raj Sharma vs Yash Pal Gupta, DK Chandel vs M/s Wockhardt Ltd. Anr and Suresh Goyal vs Amit Singhal.
12. Per Contra, Ld. Counsel for accused has argued that no offence under section 138 NI act is made out against the accused. Ld. Counsel for accused has submitted that complainant has relied upon fabricated receipt regarding the amount of Rs 23,00,000/- Complainant had obtained blank signed cheques and signatures of accused on blank papers which was later converted into the receipt. Blank signed cheques were also taken from the son of accused as security. Accused has only taken loan of Rs. 3,00,000/- from the complainant and returned most of the amount, however, complainant started demanding more money as interest and engaged in altercation with accused. Complainant misused the cheques of accused and filed false complaint against him. It is argued that accused does not have liability to pay the cheque amount and complainant has misused the cheques. Ld. Counsel for accused has relied upon the judgment of Hon'ble High court of Bombay in Anil vs Purushottam and of Hon'ble Supreme Court of India in Rangappa vs. Sri Mohan, Prakashan vs P.K. Surendran, Murugan vs M.K. Karunagaran, Kumar Exports vs Sharma Carpets, Basalingappa v. Mudibbasappa and CC No. 15625/2016 Page No. 9 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:10:09 +05'30' Maria Margarida Sequeria Fernandes and ors. Vs. Erasmo Jack De Sequeria through LRs.
LEGAL PROVISION
13. Before adverting to scanning the evidence under the lens of the law pertaining to the lis at hand, let us revisit the legal benchmark to be satisfied as enunciated in Section 138 of the Act.
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, of 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 provision of this Act, be punished with imprisonment for a term which may extend 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--
(a) the 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;
(b) 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 CC No. 15625/2016 Page No. 10 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:10:28 +05'30' information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the 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.
Explanation.--For the purposes of this section, "debt or other liability" means a legally enforceable debt or other liability.
ANALYSIS
14. The essential ingredients that can be culled out from the statutory provision are:
i) 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;
ii) The cheque should have been issued for the discharge, in whole or in part, of any debt or other liability;
iii) 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;
iv) 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;
v) 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 notice in writing, to the drawer of the cheque, within 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
vi) The drawer of such cheque fails to make
CC No. 15625/2016 Page No. 11 of 24
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Vyas Date: 2024.08.29
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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. Being cumulative, it goes without saying that it is only when all the aforementioned ingredients are satisfied, the person who had drawn the cheque can be deemed to have committed an offence under Section 138 of the Act.
16. Averting to the facts of the present case, the cheque in question was admittedly signed by accused as he has admitted his signature on the cheque in question. The presentation and dishonour of cheque is depicted by cheque return memo Ex CW1/2 which shows the reason for dishonor as 'Funds Insufficient'. The complainant has deposed that cheque was returned dishonoured due to the said reason and the accused has also not disputed the dishonor of cheque for the above reason or the cheque return memo.
17. Ld. Counsel for accused has argued that there was no legal liability upon the accused to pay the cheque amount. The existence of legal liability for payment of amount of cheque in question is one of the necessary ingredients that has to be established by the complainant. In order to correctly appreciate this ingredient in the light of the evidence placed on record by both the parties, it is necessary to revisit the provision under Section 118 and Section 139 of the Act.
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18. Section 118 of the Act inter alia provides the presumptions as to negotiable instruments that until the contrary is proved, the presumption shall be made 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. Further, section 139 of the Act provides that 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, of any debt or other liability.
19. It is clear from the conjoint reading of both the provisions that ordinarily in the cheque dishonour cases, what the courts ought to consider is whether the ingredients of the offence enumerated in Section 138 of the Act have been met and if so, whether the accused was able to rebut the statutory presumption contemplated by Section 139 of the Act.
20. It has been held by Hon'ble Supreme Court of India in Hiten P Dalal vs Bratindranath Banerjee [(2001) 6 SCC 16]:
"....... This section provides that "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, of any debt or other liability".CC No. 15625/2016 Page No. 13 of 24
Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:11:18 +05'30' The effect of these presumptions is to place the evidential burden on the appellant of proving that the cheque was not received by the Bank towards the discharge of any liability Because both Sections 138 and 139 require that the Court "shall presume"
the liability of the drawer of the cheques for the amounts for which the cheques are drawn, as noted in State of Madras vs. A. Vaidyanatha Iyer AIR 1958 SC 61, it is obligatory on the Court to raise this presumption in every case where the factual basis for the raising of the presumption had been established. "It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused" (ibid). Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court "may presume" a certain state of affairs. Presumptions are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence showing the reasonable possibility of the non-existence of the presumed fact".
21. It was held by Hon'ble Supreme Court in the case titled as Rangappa v. Sri Mohan (2010) 11 SCC 441 that:
"26. In the 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. To that extent, the impugned observations in Krishna Janardhan Bhat may not be correct. However, this does not in any way cast doubt on the correctness of the decision in that case since it is based on the specific facts and circumstances therein. As noted in the citations, CC No. 15625/2016 Page No. 14 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:11:36 +05'30' this is of course in the nature of a rebuttal 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.
27. 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 defendant accused cannot be expected to discharge an unduly high standard of proof.
28. 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."CC No. 15625/2016 Page No. 15 of 24
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22. As can be inferred from the legal position expounded by Hon'ble Supreme Court of India, the standard of proof required to rebut the presumption raised under S.118 and 139 of the Act is only that of 'preponderance of probabilities' and therefore, the accused is required to prove only a probable defence of non-existence of liability and is not required to establish the same beyond reasonable doubt. The accused must do so by either adducing his own evidence or by punching holes in the case of the complainant.
23. Ld. Counsel for accused has argued that signatures of accused were taken on blank paper which was later converted into receipt. Complainant during his cross examination has denied that the signatures of accused were taken on blank papers. Accused has himself deposed that his signatures and signature of his wife DW-2 were taken on blank papers. DW2 has also deposed that her signature and that of accused were taken on blank papers. Two contradictory versions have come regarding the earnest receipt Ex CW1/7. The earnest receipt contains the receiving of Rupees Twenty Three Lakh allegedly given on 13.08.2013. From the contents of receipt, it appears that the amount of Rupees Twenty Three Lakh was given on 12.08.3013. However, complainant has himself deposed contradictory to the contents of receipt by stating that Rupees Twenty Lakh was given to accused in addition to CC No. 15625/2016 Page No. 16 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:12:13 +05'30' loan of Rupees Three Lakh which was already given way back in the year 2010. Further, while receipt talks of entire payment made on that day i.e., 12.08.2013, the complainant/CW-1 has stated in his cross examination that amount of Rupees Twenty Lakh was given on various instances in August 2013 meaning the same was given in installments. Therefore, the testimony of complainant himself is contradictory to the contents of receipt EX CW1/7.
24. Further, the complainant has failed to explain the source of amount of Rupees Twenty Lakh given by him. The complainant/CW1 has claimed that loan of Rupees Three Lakh earlier given to the accused was taken by him from his mother. He further deposed that the said amount has not been returned by him to his mother till the date when his testimony was recorded in the year 2018. During cross examination, complainant has stated his annual income during 2010 to 2013 was Rupees Three Lakh to Rupees Four Lakh per annum. Clearly, the complainant did not have financial capacity to pay the huge amount of Rupees Twenty Lakh to accused and that too in cash. Admittedly, the said amount was not withdrawn by him from his bank account. Complainant has given evasive and bald answers regarding the source of the amount allegedly given by him. He claimed that he had sold some gold lying with him and also certain shares and took some amount from his relative. He failed to specify the exact breakup of CC No. 15625/2016 Page No. 17 of 24 Shivan Digitally signed by Shivangi Vyas gi Vyas Date: 2024.08.29 18:12:30 +05'30' amount that he arranged from the various sources. He failed to provide the detail regarding the gold jewelry sold by him. He then claimed that his cousin has sold his shares however when questioned regarding amount received by him he failed to specify the same. He then claimed to have taken Rupees Four Lakh to Rupees Five Lakh from his brother-in- law in cash and deposed that he has not returned the said amount from him. He further stated that he does not wish to examine those persons in court. From the testimony of complainant, it appears that the complainant has been evasive during cross examination when questioned about the source of funds and has failed to explain the same. The complainant further claimed to have taken loan of Rupees Five Lakh from State Bank of India. When questioned about the details of loan, complainant failed to provide the date or year in which loan was taken and failed to produce any loan document in court.
25. Ld. Counsel for complainant has relied upon the judgment of Hon'ble Supreme Court of India in D.K. Chandel vs M/s Wockhardt Ltd. & Anr. in Crl. Appeal No. 132 of 2020 to wherein it was held that production of books account/cash book may be relevant in civil court but not in criminal cases filed under section 138 NI Act. Ld. Counsel for complainant has emphasized that complainant is not liable to bring documents to show the liability of accused. The aforesaid judgment is not applicable to facts of present case as herein the complainant did not just failed CC No. 15625/2016 Page No. 18 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:12:46 +05'30' to establish the receiving of money from accused i.e., liability of accused, but also failed to explain the sources when specifically questioned during cross examination. The complainant in his testimony miserably failed to explain the source of funds given to accused. It also appears that he did not have means or financial capacity to pay such amount to accused.
26. It is further interesting to note that the complainant has claimed to have given Rupees Twenty Three Lakh in total to the accused. The amount of cheque in question is Rupees Nine Lakh Fifty Thousand. The complainant admitted in his cross examination that he did not take any steps for recovery of the remaining amount. It appears unbelievable that the complainant would let go of major chunk of the amount still remaining to be paid by the accused and would not take any steps for recovery of same if in fact the said amount was given by him to accused.
27. Apart from the earnest receipt Ex CW1/7 contents of which are doubtful in view of testimony of complainant himself, no other document has been placed on record to show the payment of said amount to accused. No witness to the said transaction of receipt of Rupees Twenty Lakh as sale consideration has been examined in court.
28. Also, it appears rather unbelievable that complainant would advance such huge amount without any formal CC No. 15625/2016 Page No. 19 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:13:02 +05'30' agreement of sale being executed between parties. When the complainant advanced loan of Rupees Three Lakh the entire agreement Ex CW1/6 was drawn up enlisting the security taken by complainant, interest and repayment of loan amount while when complainant allegedly gave Rupees Twenty Lakh which was a much more amount than the same was given without any formal agreement. It further appears strange that a major chunk of consideration amount i.e., Rupees Twenty Three Lakh is said to have already been given as earnest money out of total alleged consideration of Rupees Thirty Five Lakh when generally only a token amount is paid as earnest money.
29. The complainant was further unable to recall the date when the cheque in question was handed over to him. The complainant has claimed in his complaint that the complainant approached accused in first week of October, 2013 for execution of property documents and the accused told that he is not interested in selling the house and issued a cheque dated 12.11.2013 as part repayment of the amount. The complainant has failed to specify the date when the cheque in question was handed over to him and stated that perhaps the same was given in November 2013 which answer appears to be convenient as the cheque bears the date of November 2013.
30. Also, the complainant admitted in his cross examination that he has not taken any steps for verification CC No. 15625/2016 Page No. 20 of 24 Shivang Digitally signed by Shivangi Vyas i Vyas Date: 2024.08.29 18:13:23 +05'30' of property documents which were in his possession. The documents admittedly were in his possession however he even failed to tell the name of documents. He admitted about not inquiring about the authenticity of documents. When the complainant has entered into agreement of sale of the same property the first step that is taken by the buyer of the property is regarding the verification of documents. No prudent buyer would agree to purchase a property without due verification. However, complainant did not verify the property papers indicating that he never intended to purchase the property of accused.
31. It also cannot be a matter of sheer coincidence that the complainant has taken the property papers of accused at the time of grant of loan of Rupees Three Lakh and then the accused agreed to sell the same property to the complainant when he was unable to repay the same. The sale consideration of the property which is allegedly set out in the complaint is also much higher than the loan amount. It appears rather strange that accused allegedly did not pay the previous loan amount of Rupees Three Lakh and complainant advanced another Rupees Twenty Lakh to accused without any formal agreement to sell, without any verification of the property papers already in his possession that too only on the basis of a earnest receipt which is typed receipt on a plain paper with no attestation or notarization. The only witness cited to the said receipt is the wife of accused who has deposed as DW2 and has herself claimed CC No. 15625/2016 Page No. 21 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:13:43 +05'30' that her signatures were taken on blank papers.
32. The defence of accused is that his signatures were taken on blank papers at the time of taking loan of Rupees Three Lakh and his two blank signed cheques were taken by complainant as security. Ld. Counsel for complainant has relied upon the Judgment of Hon'ble Supreme Court of India in Bir Singh vs Mukesh Kumar in Crl. Appeal No. 230 & 231 of 2019 and of Hon'ble Delhi High court in Lekh Raj Sharma vs Yash Pal Gupta 221(2015) DLT 585 to emphasise that if blank signed cheque is voluntarily presented to payee towards some payment the payee may fill up amount and other particulars and same would not invalidate the cheque. However, the facts of the present case are different as here as the blank signed cheque were given towards liability of Rupees Three lakh and not Rupees Twenty Three lakh. The liability of accused of Rupees Twenty Three lakh could not be established during trial.
33. The defence of accused that his blank signed cheques given as security were misused appears to be probable. Ld. Counsel for complainant has relied upon the judgment of Hon'ble High Court of Delhi in Suresh Chandra Goyal vs Amit Singhal (Crl. LP 706/2014) wherein it was held that section 138 of NI Act does not distinguish between a cheque issued by the debtor in discharge of an existing debt or liability or a cheque issued as a security cheque on the CC No. 15625/2016 Page No. 22 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:14:03 +05'30' premise that on future date the debt which shall be crystalized by then, shall be paid. In the present case, the liability of accused of the cheque amount i.e., Rupees Nine Lakh Fifty thousand could not be established at any point. It could Not be established that accused had future liability of Rupees Twenty Three Lakh n part payment of which cheque was issued.
34. The lender of loan has an upper hand in the transaction and the borrower of loan amount in desperation is usually agreeable to any or all conditions put upon him/her at the time of taking loan. Therefore, in such transactions, obtaining the signatures of accused and his family members on blank papers, obtaining blank signed cheques from accused and taking property papers as security is not uncommon. In the present complaint, the complainant miserably failed to explain the source of money allegedly paid by him, also there are contradictions regarding the instances of the amount paid whether the same was paid in one go or installments, the particular dates when such installments were paid have not been specified. Further, the entire amount being paid in cash also raises suspicion as to why such a huge amount was given in cash in contradiction of Income Tax Rules. No witness to the said amount being paid is examined in the court. All the above facts raise doubt whether amount of Rupees Twenty Lakh was in fact paid to accused in addition to loan of Rupees Three Lakh already taken by him and regarding the CC No. 15625/2016 Page No. 23 of 24 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:14:21 +05'30' existence of liability of accused to pay the alleged earnest money of Rupees Twenty Three Lakh given by complainant for purchase of property of accused. The accused has through cross examination of complainant and through his defence witnesses has rebutted the presumption of existence of legal liability. Complainant has failed to establish that earnest money of Rupees Twenty-Three Lakh was given to accused or that the accused is liable to repay the same.
CONCLUSION
35. From the above discussion, it can be concluded that the complainant has failed to establish the necessary ingredient of existence of legal liability for offence under section 138 NI Act. Consequently, this court finds the accused Gopal Krishan not guilty of offence under section 138, Negotiable Instruments Act, 1881 and acquits him accordingly.
Announced in open court on 29.08.2024 Shivangi Digitally signed by Shivangi Vyas Vyas Date: 2024.08.29 18:14:48 +05'30' (Shivangi Vyas) JMFC (NI Act), North West Rohini, Delhi CC No. 15625/2016 Page No. 24 of 24