Delhi District Court
Complainant vs . on 29 October, 2014
IN THE COURT OF SHRI PUNEET PAHWA
METROPOLITAN MAGISTRATE 01 (N.I. ACT)
PATIALA HOUSE COURTS : NEW DELHI
Anuradha Singh
Proprietor of M/s Charisma,
C61, Sector39,
NOIDA, 201301,
Uttar Pradesh.
....................... Complainant
Vs.
Anil Kumar Aggarwal
Partner, M/s Home Concepts,
A50, Sector58,
NOIDA, U.P.
Also at:
46 A, PocketA/10,
Kalkaji Extn.,
New Delhi110019.
................................Accused
Case Number. :
1574/1, 3581/1, 492/1 &
3516/1
Date of Institution of Present Cases : 16.02.2008, 16.07.2008,
16.02.2008 & 07.02.2008
respectively.
Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 1 of 39
Offence Complained Of. : U/s 138 NI Act
Plea of the Accused. : Not Guilty
Arguments Heard On. : 14.07.2014.
Final Order. : Acquittal.
Date of Judgment. : 29.10.2014.
- :: JUDGMENT ::
1.Vide this common judgment, I shall dispose of four complaints bearing CC No.1574/1, 3581/1, 492/1 & 3516/1 pending between the same parties, filed by the complainant u/s 138 Negotiable Instruments Act, 1881 (hereinafter referred to as "N.I Act").
2. Brief facts of the case as alleged by the complainant are that the complainant is an export / buying agent engaged in the business of exporting home furnishings and various other consumer goods to big buying houses in Europe and U.S.A. Vide authorization letter dated 13.02.2008, the complainant has authorized Mr. Bhagwat Singh Parihar to pursue with the present complaints on behalf of the complainant. The accused is partner in the firm M/s Home Concepts, engaged in the business of fabrication and manufacture of consumer goods including home furnishings. The accused approached the Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 2 of 39 complainant and requested her to forward orders received by her from her clients for execution by his firm on commission @ 5% being payable to the complainant by the accused for the orders forwarded to his firm. In pursuance to the request, the complainant forwarded several orders received by her for execution by the firm of the accused. After the execution of the orders and after the accused received the payment from the clients of the complainant, the commissions became due and payable to the complainant. For the part payment of the commission, the accused handed over the following cheques which on presentation were received back unpaid:
IN CC NO.1574/1 Sl. CHEQUE AMOUNT DATE OF EXHIBIT RETURN
No. NO. ISSUANCE MEMO
EXHIBIT
1 827330 1,00,000/ 17.01.2008 Ex. CW 1/1 Ex. CW 1/2
2 834701 1,00,000/ 20.10.2007 Ex. CW 1/3 Ex. CW 1/4
3 838283 97,502/ 17.01.2008 Ex. CW 1/5 Ex. CW 1/6
IN CC NO. 3581/1
Sl. CHEQUE AMOUNT DATE OF EXHIBIT RETURN
No. NO. ISSUANCE MEMO
EXHIBIT
1 547623 86,114/ 05.06.2008 Ex. CW 1/1 Ex. CW 1/2
2 547624 73,750.50/ 05.06.2008 Ex. CW 1/3 Ex. CW 1/4
3 547625 73,750/ 05.06.2008 Ex. CW 1/5 Ex. CW 1/6
IN CC NO. 3516/1
Sl. CHEQUE AMOUNT DATE OF EXHIBIT RETURN
No. NO. ISSUANCE MEMO
EXHIBIT
1 207349 1,50,000/ 24.12.2007 Ex. CW 1/2 Ex. CW 1/4
Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 3 of 39
2 207977 1,50,000/ 24.12.2007 Ex. CW 1/3 Ex. CW 1/6
IN CC NO. 492/1
Sl. CHEQUE AMOUNT DATE OF EXHIBIT RETURN
No. NO. ISSUANCE MEMO
EXHIBIT
1 207980 1,21,000/ 21.01.2008 Ex. CW 1/1 Ex. CW 1/2
2 842454 1,47,470/ 22.01.2008 Ex. CW 1/3 Ex. CW 1/4
3 827332 1,00,000/ 21.01.2008 Ex. CW 1/5 Ex. CW 1/6
3. It is further alleged in the complaints that when the aforementioned cheques got dishonoured, legal demand notices were served upon the accused through her counsel thereby asking the accused to pay the cheques amount. However despite the service of legal demand notices the accused failed to pay the cheque amount within stipulated period. When the accused failed to make the payment even after receipt of legal demand notices, the complainant was compelled to file the present four complaints.
4. On finding a prima facie case against the accused, he was summoned. The accused appeared and was released on bail. Notice u/s 251 Cr. P.C was served upon the accused to which he pleaded not guilty and claimed trial.
5. Sh. Bhagwati Singh, AR of the complainant had tendered his evidence by way of affidavit. In his affidavit he has reiterated the Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 4 of 39 averments made in the complaints. In his crossexamination he has submitted that he has been working with the concern of the complainant since last five years. The accused had issued the cheques against the commission and services. The commission was given by the accused to the complainant for the orders for shipments forwarded by her to the accused. The services rendered included the 100% inspection of the ready merchandise instead of random inspection as stipulated by international standard. However he did not remember if there was any formal agreement with the accused or not. The commission was charged @5% of the total invoice value of the shipments shipped of the orders forwarded by the complainant to the accused. The complainant used to charge for the extra services @ 2% of the total invoice value. The billing to the accused towards the commission and the services was together. In the bills, amount for the commission and services was not bifurcated. However in the excel sheet attached alongwith the bills, there was clear separation between the two. However he did not know whether the bills and the excel sheets were duly received by the accused by signing the same. He was not aware whether the firm of the accused was a proprietorship or a partnership firm. He did not know the accused personally. He used to visit the firm of accused in relation to his official work. After examination of the AR of complainant, the CE was closed and the case was fixed for recording Statement of accused u/s 313 Cr. P.C. Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 5 of 39
6. Statement of accused u/s 313 Cr. P.C was recorded on 07.02.2009, which is kept in CC No. 492/1. In his statement the accused had admitted the issuance of cheques in question but he submitted that the same were issued against wrong debit notes raised by the complainant. He admitted that he had received legal demand notice and that the same was duly replied by him to the effect that the demand of the complainant is wrong and not as per the books of account and the complainant was asked to reconcile the books of account. He had denied any liability towards the complainant. The explanation given by the accused was that as per their books of account he had paid excess amount to the tune of Rs.18 lakhs to the complainant and in fact it was the complainant who was under liability towards him. After recording Statement of accused u/s 313 Cr. P.C the accused was called upon to lead DE.
7. In his defence evidence the accused examined Sh. R.K. Aggarwal, Sr. Manager, Punjab National Bank, South Extn., Part1, New Delhi as DW 1 who had produced the bank certificate dated 22.04.2009 issued by PNB, Ex. DW 1/1; the details of sale invoices for the period 01.04.2004 to 31.03.2005 Ex. DW 1/2; the bank certificate and payment details of the complainant for the period w.e.f 01.04.2005 to 31.03.2006 Ex. DW 1/3 and, bank certificates & details Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 6 of 39 of cheques issued to the complainant Ex. DW 1/4 (collectively.). Ld. Counsel for the complainant had objected to the filing of the documents by the witness on the ground that the documents filed with the certificate did not relate to the witness. However, objection was rejected as the witness had stated that payment details which have been produced were as per the original documents lying with the bank. He further stated that he had been dealing with the account maintained by the accused with his bank since 2007. He had very categorically stated that there were no invoices other than the one mentioned in the certificate produced by him. All the invoices mentioned in the documents produced by him were personally inspected and verified by him. He had further deposed that even the invoices pertaining to the period when he was not in the branch have been inspected and verified by him. However, he was not aware as to how much commission was due to the accused from the complainant. He had denied the suggestion that the documents produced by him were incorrect or that the certificates were issued by him at the behest of the accused without verifying the record or without having any knowledge.
8. Thereafter the accused himself stepped into the witness box as DW 2. DW 2 i.e. accused himself had deposed that he and the complainant had started an export firm in year 2003 and he met with the complainant in Textile Trade Fair where she was looking for some Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 7 of 39 reliable suppliers. He further deposed that she asked him to execute her orders and since he was looking for business, he started working with her. It was decided that the complainant will bring the business and he will pay her 5% commission on the invoice value to be shipped to her buyers. They worked together since 2004 to 200708 and paid her all commissions due to her by giving cheque to her in advance. In September 2007 she had stopped placing orders with him and she had tied up with an expartner of the firm and despite his doing all samples development she betrayed him. DW 2 has disclosed the business transactions took between him and the complainant which are as under:
Business Transactions Year Total Commission Actual Extra Exhibit Business Due Amount Amount Paid Paid 200405 2,02,85,400/ 10,14,270.52/ 11,58,421/ 1,44,150.48/ Ex. DW 2/1 200506 3,43,89,540/ 17,19,477.24/ 17,98,813/ 79,335.76/ Ex. DW 2/34 200607 5,22,72,040/ 26,13,602.30/ 30,01,426/ 3,87,823.70/ Ex. DW 2/91 200708 1,33,42,640/ 6,67,132.07/ 10,12,330/ 3,45,197.93/ Ex. DW 2/183 Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 8 of 39
9. A combined bank certificate showing payments made by cheques in the year 200405, 200506, 200607, 200708 totalling Rs.64,22,627 duly certified by the bank was also submitted as proof of payment. The accused further deposed that apart from this running account, the complainant took Rs.4,00,000/ by four different cheques of Rs.1,00,000/ each in her personal name as a proprietor of M/s Charisma. A bank certificate certifying details of cheques issued to complainant was also produced on record regarding payment being made by the accused. The accused clarified that extra amount was paid to the complainant as she was taking advance cheques for the approximate business which sometimes was less and sometimes was more. He further submitted that several requests were made by him to the complainant to reconcile the account which she avoided and said since it was a running account, it was agreed to be adjusted in future orders. The accused issued various letters regarding excess amount being paid and also regarding procurement of business. Letters are Ex. DW 2/198 and Ex. DW 2/200 and UPCs are Ex. DW 2/199 & Ex. DW 2/201. He also requested the complainant to return the cheques given by him for future business. The letter is Ex. DW 2/202 and UPC is Ex. DW 2/203. Ex. DW 2/204 was the reply of the notice sent by the complainant. The accused further deposed that when he asked the complainant to return the advance cheques and excess amount, the complainant threatened him that she shall file criminal cases against Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 9 of 39 him by using the advance cheques.
10. In his crossexamination the accused disclosed the name of other partner as Rafi Khan. He disclosed that he separated from Rafi Khan in November, 2007. He had admitted that in 200506 the complainant had given him business of Rs.3,43,89,540/ and from 2003 till the separation in November, 2007 he had received business worth Rs.12 crores approx. He had denied the suggestion that all the cheques handed over to the complainant were against commission received by her after payments have been received by him. He admitted that before issuance of cheques for commission TDS was deducted by him. He denied the suggestion that since TDS was being deducted it could not be advance cheque as payment has been approved. However he did not remember as to if at the time of handing over advance cheques he had taken any receipt of handing over advance cheques. The accused had brought TDS certificate for the period 2004 to 2008 which are Ex. DW 1/D1 (colly). The accused had deposed that since he was dealing after October 2007, the correspondence with the complainant was through telephone and sometimes through emails also. However he could not say as to whether any other staff member communicated with the complainant. He had admitted that the payment made to the complainant was not reflected in document Ex. DW 1/2 however the same is in the Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 10 of 39 certificate filed separately. He also admitted that in Ex. DW 1/3 it was not mentioned as to whether the payment was made as advance payment or on what account the payment was made. He categorically denied the suggestion that payments were return of the loans to the complainant in her personal capacity and not commission due to the complainant. He admitted that he had not filed any written document to show that he protested to the complainant about wrong debit notes being raised by her. He also did not remember whether he had sought reconciliation of accounts from the complainant in the year 200307. He had also admitted that no document had been placed on record to show that at the time of handing over the cheques to the complainant, the same were as advance payments to her as it was clear understanding between the parties that the cheques shall be issued in advance. He further submitted that Rs.4 lakh given to the complainant has been shown as advance payment, however he did not place any document on record to show that the said amount has been shown as advance payment. He further submitted that he had not stated in his statement at that time that the cheques were in lieu of advance payment or that any wrong debit notes were raised by the complainant but he would reveal all those things as soon as he got opportunity for making statement. During the year 200308 no legal demand notice was sent to the complainant regarding the raising of wrong debit notes or reconciliation of advance payment as there was no dispute between Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 11 of 39 them. He also admitted that he had not filed any suit for recovery of the advance payments made to the complainant nor suit for reconciliation of accounts against the complainant. In the end he again reiterated that it was not an advance payment but advance cheques were issued and as such they were not mentioned on the audit.
11. It is pertinent to mention herein that after examination of DW 2, DE was closed and final arguments were heard. However when the case was fixed for judgment the complainant moved an application u/s 311 Cr. P.C seeking permission of the court to place on record certain documents. The application was allowed and Mrs. Tulsi Dhayani was allowed to be examined as PW 2. She had tendered her evidence by way of affidavit Ex. PW 2/A. Alongwith the affidavit she had filed documents Ex. PW 2/1 to Ex. PW 2/46. Ex. PW 2/2 is the debit note 002/20072008, dated 05.04.2007 for an amount of Rs.13,99,732/. Ex. PW 2/3 is the debit note 011/20072008, dated 10.05.2007 for an amount of Rs.2,86,114/ and Ex. PW 2/4 is the debit note 020/2007 2008, dated 14.09.2007 for an amount of Rs.2,20,181/. Ex. PW 2/5 is the debit note 008/20082009 for an amount of Rs.1,66,313/. Ex. PW 2/6 & 7 are compilation sheets correlating the total invoice value. Ex. PW 2/8 to Ex. PW 236 are forwarder's cargo receipts and other dispatch documents with respect to various invoices. Mrs. Tulsi Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 12 of 39 Dhayani was subjected to crossexamination by the counsel for the accused. In her crossexamination she had submitted that she was employed with the complainant firm ever since it was established and she was looking after Merchandising Department and overseeing the Quality Control Department. She admitted that she was not involved from day to day accounting of the firm however she provided merchandising information to the accounts department on the basis of which debit notes were prepared by them.
12. Since the additional evidence was brought on record against the accused, additional statement of the accused was recorded u/s 313 Cr. P.C by putting questions regarding debit notes produced by PW2 (CW2). In additional statement the accused submitted that he has never seen such documents before and the same have been produced to cover the excess amount reached to the complainant and these are forged and after thought. After recording the additional statement u/s 313 Cr. P.C., the case was fixed for final arguments.
13. Ld. Counsel for the complainant has argued that the complainant has been able to prove the guilt of the accused beyond all reasonable doubt and therefore the accused is liable to be convicted in all the four complaint cases. The defence raised by the accused is neither plausible nor believable and the same is liable to be rejected at Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 13 of 39 the outset as he has failed to bring on record any cogent evidence to rebut the presumptions raised against him. Ld. Counsel for the complainant has argued that as per the case of the accused during the period of 2003 to 2007 the correspondence was through emails, then why some of the documents were sent through post. Moreover in none of the emails sent by the accused, the issue of advance cheques has ever been raised. All the documents pertaining to the transactions between the parties are on record in original therefore they can be relied upon. Merely because some of the documents have not been exhibited it can not be said that those documents are not proved documents. It is settled law that if the documents have been proved as per the provisions of Evidence Act, mere non marking of those documents as exhibit will not result into non reading of those documents in evidence. This argument has been made by Ld. Counsel for the complainant on the basis of judgment of Hon'ble Rajasthan High Court in Nanga Vs. Dhannalal and Ors. AIR 1962 Raj 68.
14. Ld. Counsel for the complainant has further argued that as per the agreement between the parties the payment became due as soon as the orders were executed by the accused. It was further argued that none of the notices sent by the accused was ever been received by the complainant as the complainant was not residing at that place when the said notices were allegedly sent by the accused. All the letters and Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 14 of 39 UPCs produced by the accused are forged and fabricated and the same can not be relied upon.
15. On the issue of non production of debit notes in original Ld. Counsel for the complainant has argued that since the debit notes were given in original to the accused, the same could not be produced in original by the complainant, however the invoices have been filed by the accused himself which corroborates the case of the complainant. It has also been argued that the complaints have been filed by the complainant as per law and the same has been proceeded further by Power of Attorney Holder of the complainant and merely because the Power of Attorney is not on stamp paper, it does not affect the maintainability of the present complaints as there is no requirement in law that a complaint can be filed only on the basis of Power of Attorney executed on a stamp paper. Even if it is assumed for the sake of arguments that Power of Attorney can be executed only on a stamp paper, still it does not affect the maintainability of the present complaints. Otherwise also Section 36 of the Stamp Act is very clear to the effect that once document which has not been properly stamped but has been admitted in evidence in a court of law, subsequently this issue can not be raised in the court and the same can be relied upon as an evidence for the final decision of the case.
Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 15 of 3916. She has also argued that the complaints have been signed and verified by the complainant as well as the AR of the complainant and therefore the same have been filed as per law. Once the complainant who is a proprietor has authorised some other person to prosecute the accused, it is not mandatory for the proprietor to appear himself in the witness box.
17. On the issue of pre mature filing of two complaints bearing CC No. 1574/1 & 492/1, Ld. Counsel for the complainant relying upon the judgment of Hon'ble Supreme Court passed in Narsingh Das Tapadia Vs. Goverdhan Das Partani & Anr SLP (Crl.) 1636 of 1999 has argued that even if the same have been field before the expiry of 15 days period, the cognizance of the offence has been taken by the court after expiry of 15 days period and therefore there is no infirmity in filing those complaints. The Hon'ble Supreme Court in the aforesaid judgment has observed as under:
"Mere presentation of the complaint in the court cannot be held to mean, that its cognizance had been taken by the Magistrate. If the complaint is found to be premature, it can await maturity or be returned to the complainant for filing later and its mere presentation at an earlier date need not necessarily render the complaint liable to be dismissed or confer any right upon the accused to absolve himself from the criminal liability for the offence committed."Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 16 of 39
18. Dealing with each and every case specifically, Ld. Counsel for the complainant has argued that case bearing CC No.3581/1 pertains to three cheques for Rs.86,114/, Rs.73,750.50/ and Rs.73,750.50/ respectively, totaling Rs.2,33,615/. These cheques have been issued in relation to invoices no. HC/473, HC/476, HC/477, HC/480, HC/481, HC/482 and HC/483, corresponding to debit notes 008/2008 09, dated 28.04.2008 and 009/200809, dated 05.05.2008. All the three cheques are dated 05.06.2008. CC No.3516/1 pertains to two cheques for Rs.1.5 lakh each, total Rs.3 lakh, both dated 24.12.2007. CC No. 492/1 pertains to three cheque for Rs.1,21,000/, dated 21.01.2008, Rs.1,47,470/, dated 22.01.2008 and Rs.1,00,000/ dated 21.01.2008, total Rs.3,68,470/. The debit note 002/200708, dated 05.04.2007 which is Ex. PW 2/2 is for Rs.13,99,732/ whereas debit note 011/200708, dated 10.05.2007 for Rs.2,86,114/ is Ex. PW 2/3.
19. It has been argued that to pay Rs.2,86,114/ the accused issued three cheques, two of Rs.1 lakh each and one of Rs.1,86,114/. Ex. PW 2/4 is debit note 020/200708 dated 14.09.2007 for Rs.1,97,502/ and to pay this the accused issued two cheques of Rs.1 lakh and Rs.97,502/ respectively. Debit note 008/200809 for Rs.1,47,470/ is Ex. PW 2/5 and to pay this the accused issued one cheque of Rs.1,47,470/. It has been argued that the amount due upon the accused was arrived at after deducting the TDS from the amount Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 17 of 39 mentioned in the debit notes. If the amount due is calculated from the debit notes on record it can be seen that the cheqeus issued by the accused are exactly of the same amount due which shows that the cheques were issued in discharge of legally enforceable debt and therefore the case of the complainant has been proved beyond all reasonable doubt. Ld. Counsel for the complainant has relied upon the following case laws Narasingh Das Tapadia Vs. Goverdhan Das Partani & Anr SLP (Crl) 1636 of 1999, L.K. Prabhavathi Vs. K.V. Sree Rama Murthy & Anr. 2008(1) KLJ 66, In Hiten P. Dalal Vs. Bratindranath Banerjee AIR 2010 SC 1898, Sait Tarajee Khimchand and Ors Vs. Yelamarti Satyam and Ors AIR 1971 SC 1865, Johnson Scaria Vs. State of Kerala 2006(4) KLT 290, Mamatadevi Prafullakumar Vs. Pushpadevi Kailash Kumar Agrawal II (2006) BC 155, Rakesh Jain & Ors. Vs. Vinod Kumar Bhola RFA 47678/200, Jupadi Kesava Rao Vs. Pulavarthi Venkata Subbarao & Ors 1971 SCR(3)590, Shyamlal Kumar Roy Vs. Sushil Kumar Agarwal AIR 2007 SC 637, State of Maharashtra Vs. Rashid B, Mulani (2006) 1 SCC 407 and Shiv Ram Vs. Thakur Dutt AIR 1973 H.P. 62
20. On the other hand Ld. Counsel for the accused has argued that the accused has raised plausible defence and the accused has been able to rebut the presumptions raised against him whereas the complainant Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 18 of 39 has failed to prove the case beyond all reasonable doubt and therefore the present complaints are liable to be dismissed. Ld. Counsel for the accused has raised the issue of pre mature filing of two complaints i.e. CC No. 1574/1 and 492/1. Ld. Counsel for the accused has argued that as per law a 15 days notice period is to be given to the accused to make payment and if the accused fails to make the payment within 15 days of the notice, cause of action arises on the 16th day and complaint can be filed only on or after 16th day i.e. when the cause of action has arisen. In the present case both the above mentioned complaints have been filed on 15th day itself when cause of action has not arisen and therefore these two complaints are liable to be dismissed on this ground alone. He has further argued that the case law Narasingh Das Tapadia Vs. Goverdhan Das Partani and Anr. (supra) which is being relied upon by the complainant has been overruled by a recent judgment of Hon'ble Supreme Court in Yogendra Pratap Singh Vs. Savitri Pandey & Anr Crl No. 605 of 2012. The above said judgment was passed by three judges bench of Hon'ble Supreme Court on 19.09.2014 vide which the judgment of Narasingh Das has been specifically overruled and in the said case it has been specifically observed by Hon'ble Supreme Court as under: "para 37 A complaint filed before expiry of 15 days from the date on which notice has been served on drawer/accused cannot be said to disclose the cause of action in terms of clause (c) of the proviso to Section 138 and upon such complaint which does not disclose the cause of action the Court is not Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 19 of 39 competent to take cognizance. A conjoint reading of Section 138, which defines as to when and under what circumstances an offence can be said to have been committed, with Section 142(b) of the NI Act, that reiterates the position of the point of time when the cause of action has arisen, leave no manner of doubt that no offence can be said to have been committed unless and until the period of 15 days, as prescribed under clause (c) of the proviso to Section 138, has, in fact, elapsed. Therefore, a Court is barred in law from taking cognizance of such a complaint. It is not open to the Court to take cognizance of such a complaint merely because on the date of consideration or taking cognizance thereof a period of 15 days from the date on which the notice has been served on the drawer/accused has elapsed...........................
para 38 We, therefore, do not approve the view taken by this Court in Narsingh Das Tapadia and so also the judgments of various High Courts following Narsingh Das Tapadia that if the complaint under Section 138 is filed before expiry of 15 days from the date on which notice has been served on the drawer/accused the same is premature and if on the date of taking cognizance a period of 15 days from the date of service of notice on the drawer/accused has expired, such complaint was legally maintainable and, hence, the same is overruled.".
21. Relying upon the above, Ld. Counsel for the accused has argued that the aforesaid two complaints are liable to be dismissed at the outset. Ld. Counsel has further argued that the AR of complainant who has deposed on behalf of the complainant has not been duly authorized by the complainant as the power of attorney on the basis of which the present complaints have been filed and prosecuted is not on a stamp paper as prescribed by law. Since the AR has not been duly authorized, his evidence can not be read and thus the accused is liable to be acquitted. He has further argued that all the complaints are silent on many aspects such as how much amount was exactly due to be paid by the accused and moreover there is no detail with respect to the Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 20 of 39 orders placed by the complainant, which shows that even if the entire story of the complainant is believed to be true, no offence is made out as the complaints lack in material particulars. So far as the cheuqes in question are concerned these cheques were issued as advance cheques which were payable only after execution of orders and the cheques were issued more than the amount payable to the complainant and if the amount is calculated properly after taking into account the orders placed and executed, it is clear that the entire payment has already been made by the accused and the accused is under no liability to make any further payment to the complainant. The complainant has failed to furnish any books of account or any invoice which shows that the present complaints have been filed with malafide intention despite the fact that the entire amount has already been paid by the accused. Had the complainant brought her books of account it could have been established that entire liability of the accused stands discharged.
22. Ld. Counsel has also raised the issue of non appearance of the complainant in the witness box and submitted that the complainant being a proprietorship firm is not allowed to appoint any AR and the proprietor being solely aware of the facts of the case has to depose as a witness and he can not delegate his authority to any other person, therefore the present complaints are not maintainable. The AR of the complainant was not aware of the entire facts of the case and therefore Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 21 of 39 he could not depose properly and he never certified as to how much amount was actually due. Even if entire evidence led by the complainant is believed for a moment, no case is made out against the accused.
23. The complainant had malafidely not produced statement of accounts which could have have established that nothing was due upon the accused. Since as per the orders placed by the complainant the goods were to be executed to foreign countries, it is the mandate of the law that the entire transaction and entire payment can be made only through a bank. DW 1 had produced all the document with respect to the transaction which had taken place between the complainant and the accused which certified that all the payment had been made by the accused. Since the debit notes were not produced in original, they are not legally admissible in evidence. Moreover if they were prepared prior to the complaint, then why there is no mention of debit notes, in the complaint or affidavit. It shows that present complaints have been filed just to harass the accused and not for the recovery of any legally enforceable debt.
24. In CC No. 3156/1 service of legal demand notice has not been established which is necessary requirement for an offence u/s 138 N.I. Act, therefore in this complaint the accused is entitled to be acquitted.
Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 22 of 39Moreover in the said complaint there are two notices, cause of action will arise to the second notice and the complainant is liable to be proved as to on which date the notice was served upon the accused. Moreover in CC No.492/1 also postal receipts and UPC are not proved and therefore the service of notice is also not proved in this complaint. It has also been argued by Ld. Counsel for the accused that in CC No.492/1 the document Ex. PW 2/3 is a photocopy. Moreover it is not a debit note therefore it has no legal value. It appears that the said document has been manipulated and forged just to create cause of action. The documents were not filed with the complaint at the time of pre summoning evidence which also raises doubt in the genuineness of the said documents.
25. Ld. Counsel has also raised an issue of defective legal demand notice and submitted that only one notice was issued for six cheques whereas the complaints pertain to three cheques. It has been argued that bifurcation of cause of action is unknown to criminal law and once notice has been served upon the accused, cause of action arises after the expiry of 15 days period and it is not allowed to the complainant to file two different complaints on the basis of one single notice and therefore the complaints are liable to be dismissed.
26. On the above grounds Ld. Counsel for the accused has argued Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 23 of 39 that liability of the accused has neither been ascertained nor proved by the complainant and therefore all the four complaints liable to be dismissed and the accused be acquitted for the offence u/s 138 N.I. Act. Ld. Counsel for the accused has relied upon the following case law Yogendra Pratap Singh Vs. Savitri Pandey & Anr (Crl.) 605 of 2012, Rangappa Vs. Sri Mohan 2010(6) SCC 493 , M/s Sri Balaji Agencies Pvt. Ltd Vs. M/s Samudra Ropes Pvt. Ltd 2011(4) CCC 515, Kunju Viswanadhan Vs. RamakrishananSurendran 1998 CriLJ 3533, M/s Kumar Exports Vs. M/s Sharma Carpets 2009[1] JCC [NI]34, M.S. Naryana Menon Vs. State of Kerala and Anr. (2006) 6 SCC 39 and Shyamlal Jain Vs. Evlchand Jain & Anr (Crl) 956of 2009.
27. I have heard the arguments advanced by Ld. Counsels for both the parties and have also perused the case file.
28. Bare perusal of Section 138 of the NI Act clarifies that five essential ingredients for completing the offence under Section 138 of the Act are as below:
i) Drawing of the cheque,
ii) Presentation of the cheque with the bank,
iii) Returning of the cheque unpaid by the drawee bank, Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 24 of 39
iv) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, and
v) Failure of the drawer to make payment within 15 days of the receipt of the notice.
29. It is pertinent to mention here that there are two presumptions of law as mandated by the Negotiable Instruments Act. According to Section 118 (a) of the Act, it shall be presumed that every negotiable instrument was made or drawn for consideration. By virtue of this clause, the Court is obliged to presume that the promissory note was made for consideration or until the contrary is proved. In Mallavarapu Kasivisweswara Rao Vs. Thadikonda Ramulu Firm and Others AIR 2008 SC 2898 it was held as under: "... ... ... The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its nonexistence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist...."
30. According to Section 139 of NI Act "it shall be presumed, unless the contrary is proved that the holder of a cheque received the cheque for discharge in whole or in part, of any debt or other liability." Under Section 139 NI Act there is a legal presumption that Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 25 of 39 the cheque was issued for discharging a liability and that presumption can be rebutted only by the person who drew the cheque. This presumption can be rebutted by the accused by adducing evidence. So the burden of proof is on the accused.
31. In Hiten P. Dalal Vs. Bratindranath Banerjee AIR 2010 SC 1898 it was held as under: "The words 'unless the contrary is proved' which occur in this provision (Section 139) make it clear that the presumption has to be rebutted by 'proof' and not by a bare explanation which is merely plausible. A fact is said to be proved when its existence is directly established or when upon the material before it the Court finds its existence to be so probable that a reasonable man would act on the supposition that it exists. Unless, therefore, the explanation is supported by proof, the presumption created by the provision cannot be said to be rebutted......".
22. Basically the defence raised by Ld. Counsel for the accused is as follows:
i) AR of the complainant is not duly authorized to proceed with the present complaints;
ii) Two complaints bearing CC No.492/1 and 1574/1 have been filed pre maturely on 15th day and not after the cause of action had arisen;Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 26 of 39
(iii) No cause of action is made out against the accused as the accused had already paid the entire amount to the complainant and now there is no liability upon the accused to pay any amount to the complainant
iv) The accused has sufficiently rebutted the presumptions raised against him and the complainant has failed to prove beyond all reasonable doubt guilt of the accused.
23. Now let us examine the defence raised by Ld. Counsel for the accused one by one. First defence of Ld. Counsel for the accused is that the present complaints have not been properly filed and moreover the AR of the complainant has not been duly authorized by the complainant as the power of attorney is not on a stamp paper. Furthermore the AR is not aware of the complete facts and circumstances of the case which is evident from his cross examination. To support his arguments Ld. Counsel for the accused has relied upon the following case laws M/s Sri Balaji Agencies Pvt. Ltd Vs. M/s Samudra Ropes Pvt. Ltd 2011(4) CCC 515, Milind Shripad Chandurkar Vs. Kalim M. Khan & Anr. (2011) 4 SCC 275 and Rbf Nidhi Ltd. & Anr. Vs. State of A.P. 2003(1) ALT Cri198.
Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 27 of 3924. I have gone through the case laws referred to by Ld. Counsel for the accused however the case laws referred to by Ld. Counsel for the accused are not applicable in the present case. In M/s Sri Balaji Agencies Pvt. Ltd Vs. M/s Samudra Ropes Pvt. Ltd. (supra), the authority letter was filed by the AR after the acquittal of the accused and when the appeal was pending. Whereas in Milind Shripad Chandurkar Vs. Kalim M. Khan and Anr. (supra) the appellant failed to show that he was the proprietor of the firm. But this is not the situation in the present cases. In the present case it has not been disputed by any of the parties that the authority has not been executed by proprietor of the complainant's firm or that Ms. Anuradha Singh is not the proprietor of M/s Charisma. The present complaints have been filed in the name of the proprietor firm and the proprietor and the complainants have been signed by the complainant i.e. the proprietor as well as AR. So it can not be said that the complaints have not been filed properly. So far as issue of authority letter that it is not on a stamp paper is concerned, this defence of Ld. Counsel for the accused is also not maintainable as it has nowhere been prescribed in law that a complaint can be filed only on the basis of authority letter being executed on a stamp paper. A complaint can very well be filed on the basis of a simple authority letter on a plain paper. Otherwise also this court find force in the arguments raised by Ld. Counsel for the complainant that as per Section 36 of Indian Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 28 of 39 Stamp Act once an instrument has been admitted in evidence, even if it has been so admitted mistakenly, and the parties proceed to trial, any objection to the admissibility of the said document can not be questioned at a subsequent stage. Reliance may be placed on Rakesh Jain & Ors. Vs. Vinod Kumar Bhola RFA 47678/200, Jupadi Kesava Rao Vs. Pulavarthi Venkata Subbarao & Ors 1971 SCR(3)590, Shyamlal Kumar Roy Vs. Sushil Kumar Agarwal AIR 2007 SC 637. Therefore, this contention of Ld. Counsel for the accused that the AR has not been duly appointed by the complainant to file the present complaints is overruled. In Shankar Finance & Investments Vs. State of Andhra Pradesh (2008) 8 SCC 536, the Hon'ble Supreme Court has observed that once the complaint is filed in the name of the payee and is in writing, the requirements of Section 142 are fulfilled. Who should represent the payee where the payee is a company or how the payee should be represented where payee is a sole proprietary concern is not a matter that is governed by Section 142 but by the general law. Moreover it was also observed that complaint filed in the name of proprietary concern need not be signed by its proprietor. Signing of complaint by power of attorney holder of proprietor is legal and valid. Power of attorney holder, if has personal knowledge of facts being in charge of business of proprietorship concern then he can be examined and it is not necessary that proprietor must come in the witness box. Therefore, Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 29 of 39 the contention of Ld. Counsel for the accused that the AR has not been properly authorized or the present complaints have not been properly filed is concerned, the same is overruled. However there is some force in the contention of Ld. Counsel for the accused that the present AR is not aware of complete facts of the case and in fact he has never participated in any of the transactions with the case. If we go through the crossexamination of the AR of complainant it comes to the notice that the AR was unable to answer many questions put to him by Ld. Counsel for the accused. In fact he was not aware as to whether the complainant's firm was a government approved buying agency or not. He also did not remember as to whether there was any formal agreement with the accused. He also did not know as to whether the bills or excel sheets were duly received by the accused. He also did not know as to whether apart from the buyer named Alinea, the complainant charged for services from the accused person. In fact he also did not know as to whether the firm of the accused was a proprietorship or a partnership firm nor he knew the accused personally. He was not aware if any reports of 100% quality inspection was ever given to the accused or the buyers. He did not have any idea as to when the shipments was dispatched. Therefore, from the entire crossexamination of the complainant witness it can be said that the AR of the complainant was not well conversant with the material facts of the case, which definitely weakens the case of Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 30 of 39 the complainant to some extent.
25. During the course of arguments, Ld. Counsel for the accused has also raised one issue regarding sending single notice of six cheques. However, this contention of Ld. Counsel for the accused is not sustainable as there is no bar for raising demand of more than one dishonoured cheque in a single notice. In Shree Lalit Fabrics Pvt. Ltd Vs. Linkers Associates Ltd. II 62 (1996) DLT 507 and Hindustan Power Control Vs. Swarna System 1999(2) RCR (Crl.) 213 it has been held that notice containing demand of payment of more than one dishonoured cheque is valid and action can be taken under Section 138 on this basis.
26. Now coming to the second defence put forth by Ld. Counsel for the accused that the two complaints bearing CC No. 1574/1 & 492/1 have been pre maturely filed on the 15th day and not after the cause of action had arisen. It is well settled law that in the cases u/s 138 N.I. Act, after service of notice 15 days period is given to the accused to make the payment and it is only when the accused fails to make the payment on the 15th day, the cause of action arises on the 16th day only and it is only thereafter a complaint u/s 138 N.I. Act can be filed. In CC No.1574/1 it is on record that legal demand Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 31 of 39 notice was sent by the complaint on 30.01.2008 and even if it is presumed that the notice was served in due course on the next day i.e. 01.02.2008 and counting the period from 01.02.2008, 15 days period expires on 15.02.2008 and if the accused fails to make the payment on or before 15.02.2008 cause of action arises from 16.02.2008 and complaint can be filed only on 16.02.2008 or thereafter. But the present complaint has been filed on 15.02.2008. Similar is the case in CC No.492/1. To counter this argument Ld. Counsel for the complainant has relied upon the judgment of Hon'ble Supreme Court in Narasingh Das Tapadia Vs. Goverdhan Das Partani and Anr (supra) and submitted that both the complaints i.e. 1574/1 & 492/1 were filed on 15.02.2008 but cognizance was taken by the court on 21.02.2008 i.e. after expiry of 15 days and thus the present complaints are maintainable. In a recent judgment of Hon'ble Supreme Court in Yogendra Pratap Singh Vs. Savitri Pandey & Anr. Crl. Appl. No. 605 of 2012, the Hon'ble Supreme Court has categorically observed as under:
"para 38 We, therefore, do not approve the view taken by this Court in Narsingh Das Tapadia and so also the judgments of various High Courts following Narsingh Das Tapadia that if the complaint under Section 138 is filed before expiry of 15 days from the date on which notice has been served on the drawer/accused the same is premature and if on the date of taking cognizance a period of 15 days from the date of service of notice on the drawer/accused has expired, such complaint was legally maintainable and, hence, the same is Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 32 of 39 overruled".
Therefore, the contention of Ld. Counsel for the complainant is not maintainable and thus this issue is decided in favour of the accused and against the complainant. Accordingly, in the two complaints bearing CC No.1574/1 & 492/1 the accused is entitled to be acquitted on this ground alone, as these two complaints have been filed prematurely.
27. Now coming to the third defence raised by Ld. Counsel for the accused that no cause of action has been made out against the accused as the complaints are silent on material particulars and even if it is presumed for a moment that whatever has been written therein is true, still no offence u/s 138 N.I. Act is made out. In CC No.1574/1, 6516/1 & 492/1 the complaints are silent about the orders being placed by the complainant, the amount to be received as commission by the complainant from the accused and to discharge what liability the cheques in question have been issued by the accused. The only thing which has been mentioned in para 4 is that '.....the complainant forwarded several orders received by her for execution by the firm of the accused. After the execution of the orders and after the accused received the payment were received from the clients of the complainant, the commissions became due and payable to the complainant'. But there is no detail as to what Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 33 of 39 orders were placed, of how much amount and what amount was due as commission to be paid to the complainant. In fact the affidavit furnished by the complainant in his evidence is also silent upon this issue. It is only in CC No.3581/1 the complainant has disclosed the invoice no. regarding which the cheques have been issued. Ld. Counsel for the accused has argued that as per the case of the complainant itself the commission due was 5% on the amount received by the accused after execution of orders and if the entire amount paid by the accused to the complainant as commission is calculated, the amount paid by the accused is more than what is due upon him and in fact it is the complainant who is under liability to return back the additional amount being paid by the accused. Since the transactions in question involved export of material, as per the Rules framed by concerned authorities the entire transaction is to be conducted through a banker and the payments are to be made through banker only. No transaction involving export of anything can be done without the involvement of a banker. In the present case also all the transactions of the payments were made through Punjab National Bank (PNB).
28. The record of all the transactions has been produced by the official who had appeared on behalf of PNB as DW 1. The witness produced banker certificate dated 22.04.2009 Ex. DW 1/1, the details Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 34 of 39 of sale invoices and other documents which are Ex. DW 1/2 to Ex. DW 1/4. He very categorically stated that all the invoices mentioned in the documents produced by him were personally inspected and verified and even the invoices pertaining to the period when he was not in the branch have been inspected and verified by him. Although he could not tell as to what commission was exactly due to the accused from the complainant but he was able to show that he had produced the record regarding all the transactions which had taken place between the accused and the complainant and this fact has not even been disputed by the complainant.
29. Ld. Counsel for the complainant during the arguments has referred each debit note on record and tried to correlate the debit notes, invoices and cheques in question to prove liability of the accused. Taking for example debit note 002/200708 which is Ex. PW 2/2 in CC No.492/1 Ld. Counsel for the complainant has submitted that details and the invoices corresponding to this debit note is Ex. PW 2/6, which clearly shows the invoices, total value of the invoices, commission to be paid to the complainant and total bills amount. As per this debit note, total bill was Rs.13,99,732/, out of which Rs.9 lakh has been paid by the accused. After deducting TDS the balance amount to be paid was Rs.4,21,000/ and in part discharge of the liability the accused issued one cheque bearing Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 35 of 39 no.207980 for Rs.1,21,000/, which is subject matter of CC No.492/1. Similarly debit note 011/200708 which is Ex. PW 2/3 is for an amount Rs.2,86,114/ and to discharge this liability the accused issued two cheqeus of Rs.1 lakh each and one cheque of Rs.86,114/. One cheque is subject matter of CC No.1574/1, second cheque is subject matter of CC No.492/1 and the third cheque is subject matter of CC No.3581/1.
30. On the above point Ld. Counsel for the complainant has tried to prove that the cheques in question were issued by the accused in discharge of his liability. However when we go through the document Ex. PW 2/6 corresponding to debit note 002/200708 it comes to the notice that the commission for the complainant has been calculated @7% and not @5%. For example in invoice HC/384, the bill amount was €29,422.10 and the commission for the complainant has been calculated €2,059.55, which comes to Rs.1,16,879.29. It is clear that this commission has been charged @7% of the total invoice value and not @5%. It is not understandable as to why 7% commission has been charged whereas at the top of the table the commission has been clearly mentioned as 5% and when it is calculated @5%, the commission comes out to €1471.1 i.e. Rs.83,485/. If we take another example, invoice HC/385 for invoice value €30,595 the commission charged is Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 36 of 39 €2141.67 which comes out to Rs.1,21,539/, however, if it is calculated @5% then the commission due is €1529.75 i.e. Rs.86,813/. Throughout the trial it has been the case of the complainant that the commission was payable @5% and neither in the complaint nor in the evidence the complainant has ever averred that the commission was chargeable @7% and not @5%. Although there was no written agreement between the parties and even if it is assumed that it was orally agreed between the parties that the commission would be payable @7% then why the complainant had not claimed commission @7% in her complaints. This create doubt in the entire case of the complainant.
31. Thus keeping in view all this, the story put forth by the accused appears to be believable. Although during crossexamination AR of the complainant had stated that they used to charge 2% extra for the services of the total invoice value and billing to the accused towards the commission and services, but this was never the case of the complainant. Anything which is beyond the purview of the complaint can not be taken into account to decide the present complaint.
32. Hence, from the defence put forth by the accused it can be said that the accused has been able to rebut the presumptions raised Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 37 of 39 against him u/s 118 & 139 of N.I. Act and consequently we enter into the forth defence raised by Ld. Counsel for the accused that once the accused is able to rebut the presumptions raised against him, the onus shifts back upon the complainant to prove guilt of the accused beyond all reasonable doubt which the complainant has failed to do in the present case. Relying upon the decision in Rangappa Vs. Sri Mohan(supra) Ld. Counsel for the accused has argued that if the accused is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the complainant who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of N.I. Act. The burden upon the accused of proving the nonexistence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the complainant is entitled under law to rely upon all the evidence led in the case including that of the complainant as well.
33. It is well settled law that the presumptions u/s 118 & 139 of N.I. Act are rebutable presumptions and once the accused is able to rebut those presumptions, onus shifts backs upon the complainant to prove the guilt of the accused beyond all reasonable doubt. In the Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 38 of 39 present case also this court is of the view that the accused has been able to rebut presumptions raised against him and once these presumption have been rebutted it becomes duty of the complainant to prove the case beyond all reasonable doubt. The complainant has failed to produce books of account and other evidence so as to bring home the guilt of the accused, therefore, this defence of Ld. Counsel for the accused is decided in favour of the accused and against the complainant.
FINAL ORDER.
34. In the end it can be said that the accused has been able to rebut the presumptions raised against him and the complainant has failed to prove guilt of the accused beyond all reasonable doubt and thus the accused is entitled to be acquitted in all the four cases for the reasons mentioned above. Accordingly, the accused stands acquitted in all the four cases.
Announced in the open Court on 29th October, 2014 (PUNEET PAHWA) MM (NI ACT1) PATIALA HOUSE COURTS NEW DELHI Case No. 1574/1, 3581/1, 492/1 & 3516/1 Page 39 of 39