Delhi District Court
27.Further, The Hon'Ble High Court Of ... vs Lt. Col. on 31 August, 2022
Rina Ari v. Prosenjit Kumar Dey
CC No.633627/2016
IN THE COURT OF MS. TWINKLE CHAWLA: MM, NI ACT-02, SOUTH-
EAST DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
Rina Ari v. Prosenjit Kumar Dey
CC No.633627/2016
U/s 138 Negotiable Instruments Act, 1881
1. CIS number : DLSE020073922016
2. Name of the Complainant : Smt. Rina Ari.
3. Name of the Accused, : Sh. Prosenjit Kumar Dey, r/o RZ-290,
parentage & residential Tughlakabad Extension, (First Floor),
address Opposite Bikaner Sweets, New Delhi-
110019.
4. Offence complained of or : U/s 138 of Negotiable Instruments Act,
proved 1881
5. Plea of the Accused : Pleaded not guilty and claimed trial
6. Final Judgment/order : CONVICTED
7. Date of judgment/order : 31.08.2022
JUDGMENT
1. The Complainant has filed the present complaint under Section 138/142 of Negotiable Instruments Act, 1881 ("NI Act") against the Accused on the averments that the Complainant, on account of good relations, advanced a loan of Rs. 2,00,000/- to the Accused by way of an agreement dt. 22.05.2014, duly signed by the parties, and notarized.
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2. As per the Complainant, the Accused in discharge of his liability, issued a cheque bearing No. 000041, drawn on Bank of Baroda, K.G. Marg, New Delhi for an amount of Rs. 2,00,000/-, dt. 23.05.2016, in favour of the Complainant. (Hereinafter referred to as "Cheque in question")
3. The Cheque in question when presented was returned unpaid on grounds of funds insufficient, by way of return memo dt. 26.05.2016.
4. The Complainant sent the legal demand notice dated 08.06.2016 through registered post at address of the Accused. Hence, despite the service of the legal demand notice, the Accused failed to make the payment within the stipulated period and the Complainant filed the present complaint.
5. At the time of pre-summoning evidence, the Complainant examined herself as CW- 1 and tendered her pre-summoning evidence affidavit, Ex. CW1/1, and also proved the following documents:
Ex. CW1/2: Original loan agreement executed between the parties on 22.05.2014.
Ex. CW1/3: Original cheque bearing no. 000041 dated 23.05.2016 for an amount of Rs. 2,00,000/-.
Ex. CW1/4: Original cheque return memo dated
26.05.2016.
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Mark A: Copy of legal notice dated 08.06.2016.
Ex.CW1/5: Original postal receipt dt. 08.06.2016.
Ex.CW1/6: Original postal receipt dt. 08.06.2016.
Ex.CW1/7: Original courier receipt.
Ex.CW1/8: Return envelope qua the legal demand
notice, with endorsement dt. 11.06.2016.
Ex.CW1/9: Return envelope qua the legal demand
notice, with endorsement dt. 15.06.2016.
6. After taking pre-summoning evidence, Accused was ordered to be summoned in this case for commission of offence under Section 138 of NI Act, vide order dated 03.12.2016.
7. Accused appeared and was released on bail on 29.08.2017. On finding a prima facie case, notice U/s 251 of the Criminal Procedure Code, 1973 ("CrPC") was served upon the Accused on 29.08.2017 to which he pleaded not guilty and opted to contest after disclosing the following defence:
"I do not plead guilty and claim trial. I had taken Rs. 2,00,000/- loan from the Complainant as per the agreement placed on record. I had issued the impugned cheque to the Complainant after signing and filling all the particulars except the date. The cheque was given as security. Digitally signed Page 3 of 24
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Payment has already been made to the Complainant. I did not receive the legal notice."
8. The Accused did not seek any opportunity for cross-examining the Complainant and the matter was fixed for defence evidence, vide order dt. 29.08.2017.
9. Thereafter, the Accused led defence evidence and examined himself as DW1 and he brought on record, Ex. DW1/A (OSR), i.e., copy of his bank account statement. DE was then closed by way of his separate statement on 29.04.2022.
10. Then the Accused was then examined under Section 313 of CrPC on 08.06.2022 for explaining the circumstances appearing against him in the Complainant's evidence. He denied the Complainant's case and pleaded false implication in the present case and did not opt to lead further defence evidence.
11.I have heard Ld. Counsel for the parties and have perused the case file along with the written submissions filed by the parties carefully and meticulously. Submissions of the Complainant and Accused
12.The Ld. Counsel for the Complainant has submitted that all ingredients of Section 138 NI Act are fulfilled in the present case and hence, the presumption under Section 139 NI Act arises in the favour of the Complainant, which has not been successfully rebutted by the Accused.
13.Per contra, Ld. Counsel for the Accused has submitted that the Accused deserves Page 4 of 24 TWINKLE Digitally signed by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:48:52 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 to be acquitted as the Accused has already repaid the complete loan amount and the Complainant has misused the cheque given as security cheque. Further, it has been stated that the Accused has not received the legal demand notice and the complaint in question is pre-mature. Hence, as per the Ld. Counsel for the Accused, the Accused has rebutted the presumption by way of preponderance of probabilities. Legal Framework:
Ingredients of Section 138 NI Act:
14.The Hon'ble Supreme Court of India in Kusum Ingots & Alloys Ltd and Ors v. K Pennar Peterson Securities Ltd and Ors., (2000) 2 SCC 745 ("Kusum Ingots Case"), has clearly stipulated that "the ingredients which are to be satisfied for making out a case under the provision are:
(i) a 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 for the discharge of any debt or other liability; 1
(ii) 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;
1
Reduced to three months vide RBI circular dated 04.11.2011. Digitally signed Page 5 of 24 TWINKLE by TWINKLE CHAWLA
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(iii) 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;
(iv) 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 2 drawer of the cheque, within 15 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(v) the drawer of such cheque fails to make 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;
If the aforementioned ingredients are satisfied then the person who has drawn the cheque shall be deemed to have committed an offence."
15.Therefore, if the aforesaid ingredients are made out, the Accused is deemed to have committed an offence under Section 138 NI Act.
Presumption under Section 139 NI Act/Section 118 NI Act:
16.Section 139 NI Act states that:
2
The same is now enhanced to 30 days.Digitally signed
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"Presumption in favour of holder: It shall be presumed, unless the contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, of any debt or other liability"
17.Section 139 NI Act is a type of reverse onus clause, which stipulates a presumption in the favour of the Complainant as to fact of a cheque being received in discharge of a legal debt or liability.
18.Further, Section 118(a) of the NI Act, states as follows:
"Presumptions as to negotiable instruments. -- Until the contrary is proved, the following presumptions shall be made:
(a) of consideration --that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;"
19.The Hon'ble Supreme Court of India has in a number of judgments dealt with the combined effect of the presumptions raised under Section 139 and Section 118(a) NI Act.
20.The following proposition can be summarized on a perusal of the judgments of the Hon'ble Supreme Court of India in Sunil Todi & Ors v. State of Gujarat, LL 2021 Page 7 of 24 Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:49:30 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 SC 706, Kalamani Tex v. P. Balasubramanian, 2021 SCC OnLine SC 75; APS Forex Services Pvt. Ltd. v. Shakti International Fashion Linkers and Ors., AIR 2020 SC 945 ("APS Forex Case"); Rohitbhai Jivanlal Patel v. State of Gujarat and Ors., AIR 2019 SC 1876; Kumar Exports v. Sharma Carpets, (2009) 2 SCC 513 ("Kumar Exports Case"); K.N. Beena v. Muniyappan and Anr., (2001) 8 SCC 458; and Dhanvantrai Balwantrai Desai v. State of Maharashtra, 1964 Cri. LJ 437:
(i) Once the execution of cheque is admitted; Section 139 of the NI Act mandates a presumption that the cheque was for the discharge of legally enforceable debt or liability;
(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the Accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities;
(iii) Something which is probable has to be brought on record by the Accused for getting the burden of proof shifted to the Complainant. To disprove the presumptions, the Accused should bring on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration and debt did not exist or their non-existence was so probable that a prudent man would under the circumstances of the case, act upon the plea that they did not exist;
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(iv) The words "unless the contrary is proved" which occur in 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 Section 139 NI Act cannot be said to be rebutted;
(v) To rebut the presumption, it is open for the Accused to rely on evidence led by him or the Accused can also rely on the materials submitted by the Complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely;
(vi) That it is not necessary for the Accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.
Analysis:
21.In the case at hand, it is not in dispute that the cheque in question was drawn by the Accused from his bank account, and that the Accused is the signatory of the cheque Page 9 of 24 Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:49:55 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 in question; as in the defence disclosed by the Accused U/s 251 CrPC and Section 313 CrPC statement; he has duly admitted the same. Presentation of the cheque in question by the Complainant is also not in dispute, the dishonor of the cheque in question on grounds of funds insufficient is also not in dispute, having been admitted by the Accused in his statement U/s. 313 CrPC.
22.The receipt of the legal demand notice has been disputed by the Accused. However, it is seen that in his statement u/s 313 CrPC, he has admitted that the address mentioned on the legal demand notice was his correct address. Further, the Accused has appeared in court, after service of summons at the same address. Even in the cross-examination of DW-1, he has admitted that he was working initially at the Tughlakbad address, which was a shared working space. He has in his cross- examination dt. 29.04.2022, accepted that RZ 290, Tughlkabad Extn. First Floor, was his office address, i.e., the address at which the legal demand notice was sent. Hence, merely, the fact that the Accused has other addresses of which the Complainant was also aware, but notice was not sent at those addresses, will not debase the liability of the Accused. Hence, the presumption of due service is drawn u/s 27 of the General Clauses Act.
23.In any case, even if the contention of the Accused is considered, since the summons were served on the Accused, he had the option of making the payment within 15 days of receipt of the summons. This has been succinctly laid down by the Hon'ble Supreme Court in C.C. Alavi Haji v. Palapetty Muhammed (2007) 6 SCC 555 in Digitally signed Page 10 of 24 TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:50:06 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 the following terms:
"Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act."
(emphasis supplied)
24.However, the Accused has not paid the cheque amount and hence, the defence of non-receipt of the legal demand notice, is not available to the Accused.
25.The Accused has also raised another preliminary objection and stated that the complaint is pre-mature and has not been filed with the period of limitation. It has been submitted that since the legal demand notice was unserved, the date of deemed service would be at least 30 days from the date of dispatch of the legal demand Digitally signed by TWINKLE TWINKLE CHAWLA Page 11 of 24 CHAWLA Date:
2022.08.31 16:50:17 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 3 notice (dt. 08.06.2016), i.e., 08.07.2016. However, the Complainant has filed the present complaint on 08.07.2016, itself, i.e., even prior to the expiry of 15 days from the date of the deemed service of the legal demand notice. Accordingly, it has been submitted that the present complaint is pre-mature and not maintainable. He has laid reliance on the judgment in Yogendra Pratap Singh v. Savitri Pandey (SC) (Criminal Appeal No. 1924 & 1925 of 2014).
26. In the present case, the legal demand notice, Mark A, has been dispatched on 08.06.2016 (evidenced by speed post receipt, Ex. CW1/5 and Ex. CW1/6). The said legal demand notice has been received back unserved with endorsement "बार बार जाने पर प्रप्त करता नह ीं मिला" on 11.06.2016 and 15.06.2016, i.e., Ex. CW1/8 and Ex. CW1/9. In the case of K. Bhaskaran v. Sankaran Vaidhyan Balan, 1999 Supp (3) SCR 271; the Hon'ble Supreme Court, albeit in the context of an "unclaimed report", has observed:
"No doubt Section 138 of the Act does not require that the notice should be given only by `post'. Nonetheless the principle incorporated in Section 27 (quoted above) can profitably be imported in a case where the sender has despatched the notice by post with the correct address written on it. Then it can be deemed to have been served on the sendee unless he proves that it was not really served 3 Reliance has been placed by Ld. Counsel for Accused on the judgment in Manoj Kumar Nag v. State of Jharkhand (Jharkhand High Court) (Criminal Revision No. 827 of 2012); Nasim Ansari v. State of Jharkhand (Jharkhand High Court) (Criminal Revision No. 658 of 2012).
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and that he was not responsible for such non-service. Any other interpretation can lead to a very tenuous position as the drawer of the cheque who is liable to pay the amount would resort to the strategy of subterfuge by successfully avoiding the notice.
Thus, when a notice is returned by the sendee as unclaimed such date would be the commencing date in reckoning the period of 15 days contemplated in clause (c) to the proviso of Section 138 of the Act. Of course such reckoning would be without prejudice to the right of the drawer of the cheque to show that he had no knowledge that the notice was brought to his address. In the present case the Accused did not even attempt to discharge the burden to rebut the aforesaid presumption."
27.Further, the Hon'ble High Court of Delhi in Shri Ashwani Kumar Julka vs Lt. Col. Parthojit Choudhary, 2007 CriLJ 1129, in a similar fact situation had observed that:
"It is clear from the above that 15 days' period is to be reckoned from the date when a notice is returned by the sendee as unclaimed. A conjoint reading of the two judgments of the Supreme Court in SIL Import USA (supra) and K. Bhaskaran (supra) would clearly establish that 15 days' period is to be counted from the date when the notice is received by the drawer of the cheque and not when intimation of receipt of this notice is received by the sender of the notice. Digitally signed Page 13 of 24 TWINKLE by TWINKLE CHAWLA
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In case the notice is actually received by the addressee (drawer of the cheque) 15 days' period would be reckoned from that date. In those cases, where it is a case of deemed service, namely, where the notice is dispatched at correct address but returned by the addressee and not accepted, it would be from the date when the addressee returned the notice as unclaimed. Applying these principles, it is clear that as per the endorsement on the envelope, registered envelope was lastly taken by the postman at the residential address of the accused on 29.11.1996 and at his official address on 28.11.1996 and thereafter made his endorsement to the effect that on repeatedly going to him the receiver (addressee) does not meet, hence, being returned. The period of 15 days cannot be calculated from 30.11.1996 when envelopes were received back by the respondent/complainant. If the limitation is to be counted from
28.11.1996/29.11.1996, the last date for filing the complaint would be 13/14.1.1997. The complaint was filed on 16.1.1997, which would be beyond the period of limitation, though by two days only. Unfortunately, at that time there was no provision for condensation of delay. The result may be harsh to the complainant but that cannot be held in view of the legal position laid down by the Supreme Court and extracted above."
28.Incorporating the aforesaid principle to the present case, where the legal demand notice has been received unserved with endorsement of Accused not being able to be found at the address, the commencing date for the reckoning of 15 days will be Page 14 of 24 Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:51:06 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 the date of the endorsement of return, i.e., 11.06.2016 and 15.06.2016 (As set out in Ex. CW1/8 and Ex. CW1/9). Even if the latter date of 15.06.2016 is taken, the complaint does not appear to be pre-mature, having been filed on 08.07.2016, i.e., after the expiry of 15 days from date of commencement (i.e., 15.06.2016), and before expiry of 45 days from the date of commencement. The deemed presumption of 30 days from the date of dispatch of the legal demand notice cannot be considered in the present case, as it is not the situation that the legal demand notice has not been received back in any form, but has been returned with endorsement as set out above. Accordingly, in light of the judgment of the Hon'ble Supreme Court in K. Bhaskaran Case (supra), and Hon'ble High Court of Delhi in Ashwani Kumar Case (supra) the date of commencement would be the date of the endorsement. Further, it is the duty of the Accused to then prove that he was not responsible for the non-service. However, in the present case, in his statement u/s 313 CrPC, he has admitted that the address was his correct address; and in his DE that the same was a shared working space and was his office address. Accordingly, the complaint has been filed within the limitation period. Therefore, essential ingredients (i) to (v) as stipulated by the Hon'ble Supreme Court in Kusum Ingots Case (supra), have been duly satisfied.
29.Further, as noted above, once the execution of the cheque by the Accused is proved/admitted, the presumption of the same being drawn for consideration stands attracted in terms of Section 139 NI Act. Now, in the case at hand, so far as the Digitally signed Page 15 of 24 by TWINKLE TWINKLE CHAWLA CHAWLA Date:
2022.08.31 16:51:25 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 question of existence of basic ingredients for drawing of presumption U/s 118 (a) and 139 of the NI Act is concerned, from the aforesaid discussion, it is apparent that the Accused has not denied his signatures on the cheque in question that has been drawn in favour of the Complainant on a bank account maintained by the Accused; and hence the said presumption can be drawn. The Ld. Counsel for the Accused has stated that such inference cannot be drawn as the Complainant has filled the date on the cheque in question. At this stage, reliance can be laid on the observations of the Hon'ble SC in Bir Singh v. Mukesh Kumar, (2019) 4 SCC 197; wherein it has been held that:
"It is immaterial that the cheque may have been filled in by any person other than the drawer, if the cheque is duly signed by the drawer. If the cheque is otherwise valid, the penal provisions of Section 138 would be attracted...
38. If a signed blank cheque is voluntarily presented to a payee, towards some payment, the payee may fill up the amount and other particulars. This in itself would not invalidate the cheque. The onus would still be on the Accused to prove that the cheque was not in discharge of a debt or liability by adducing evidence...
40. Even a blank cheque leaf voluntarily signed and handed over by the Accused, which is towards some payment, would attract presumption Digitally signed Page 16 of 24 TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:51:42 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 Under Section 139 of the Negotiable Instruments Act, in the absence of any cogent evidence to show that the cheque was not issued in discharge of a debt."
(emphasis supplied)
30.The same view has been endorsed by the Hon'ble High Court of Delhi in Ravi Chopra v. State, CRL.M.C. 5211/2006.
31.Hence, in view of such clear stipulation by the Hon'ble Supreme Court and Hon'ble Delhi High Court, it is immaterial whether or not the particulars on the cheque have been filled by the Accused or not, to the extent the Accused has admitted to have appended his signatures on the cheque in question. Accordingly, the applicability of the presumption under Section 139 NI Act is not dependent upon the Accused filling the particulars, including the date, on the cheque. Accordingly, it is required to be presumed that the cheque in question was drawn for consideration and the holder of the cheque i.e., the Complainant received the same in discharge of an existing debt. The onus, therefore, shifts on the Accused to establish a probable defence so as to rebut such a presumption.
32.In the segment on legal framework, set out above, the legal proposition with respect to the burden of proof upon the Accused has already been discussed. Hence, it is now to be examined as to whether the Accused brought any material on record or pointed out glaring discrepancies in the material produced by the Complainant Page 17 of 24 Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:52:03 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 for dislodging the presumption which meets the standard of preponderance of probabilities.
31.The Accused in the present case, has taken the following line of defence with a view to rebut the presumption:
(i) Misuse of security cheque after repayment of loan amount:
32.The Accused has taken the defence that he has already repaid the loan amount and the cheque in question has been misused by the Complainant. The execution of the agreement/undertaking Ex. CW1/2 is not in dispute as the Accused has himself in his defence evidence dated 06.04.2018, and statement u/s 313 CrPC has admitted to the same. Hence, advancement of loan of Rs. 2,00,000/- in 2014 on interest at the rate of 5% per month by the Complainant to the Accused is not in dispute. What is in dispute in the present case is: (A) whether the loan agreement Ex. CW1/2 was further extended for a period of 12 months in May, 2015; and (B) whether the loan amount has been repaid by the Accused.
33.It is the case of the Complainant that while the loan was advanced in 2014, the said loan agreement as per clause 5 of Ex. CW1/2 was extended for another period of 12 months and as repayment of the principal loan amount, the cheque in question was issued to the Complainant on 23.05.2016. Per contra, the Accused has submitted that he repaid the total amount borrowed from the Complainant and within 12 months of execution of Ex. CW1/2 and hence, there was no occasion for issuance of the cheque in question on 23.05.2016. It is seen Page 18 of 24 Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:52:24 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 that as per clause 5 of Ex. CW1/2 it is noted that "the tenure of the loan agreement may be extended for further 12 months unless terminated in writing with mutual consent." Accordingly, the import of the agreement appears to be that it would automatically be renewed for another period of 12 months unless terminated in writing.
34.In the cross-examination of the Accused on 24.02.2022, when he was confronted with the said clause, he has stated that he never read Ex. CW1/2 so carefully and hence, while there is no written termination of the agreement, his case is that the agreement was not extended for another period 12 months. It is a matter of record that the said agreement Ex. CW1/2 was not terminated by any written communication. Hence, the testimony of the Accused purports to modify the terms of a written agreement, which is inadmissible in light of section 91 and 92 of the Indian Evidence Act, 1872. Accordingly, in the absence of proof of repayment of Rs. 2,00,000/- by the Accused to the Complainant within one year, the fact of termination of Ex. CW1/2 has not been proved by the Accused.
35.The Accused has deposed that he has paid the complete loan amount within one year of the agreement and there was some dispute with respect to the interest component, which has also been cleared by the Accused by way of payment through two cheques of Rs. 25,000/- and Rs. 8,000/- respectively. The Accused has filed a copy of his bank statement Ex. DW1/A (OSR) in support of his Digitally signed by TWINKLE Page 19 of 24 TWINKLE CHAWLA CHAWLA Date:
2022.08.31 16:52:45 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 submission. Perusal of record of Ex. DW1/A shows that the said payment has been made on 19.11.2015.
36.It is the case of the Accused that the entire loan amount apart from this payment of Rs. 33,000/- has been made in cash. In the cross-examination of the Accused, it has also come on record that there was no written record/ receipt of the payment of loan amount in cash by the Accused to the Complainant. Further, the Accused has stated that when he sought a return of the cheque in question, the Complainant told him that the said cheque has been misplaced by her. However, in the cross-examination of the Accused, it has also been brought on record that there was no written demand of the cheque in question made by the Accused and that the Accused did not take any legal steps for the misplacement of the signed cheque in question. In fact, he did not issue any stop payment instructions to the bank as well. It is trite law that circumstantial evidence has to be viewed from the point of view for a reasonable manner (Reliance placed on Kumar Exports Case (supra)).
37.Hence, when the loan amount was already repaid; and no receipts were taken from the Complainant against re-payment, why did the Accused not take any legal action for getting the security cheque back, or in the least, issue a written notice to the Complainant to return the said cheques. The Hon'ble Delhi High Court in VS. Yadav v. Reena, 172 (2010) DLT 561, where the Accused had similarly pleaded that no loan was ever taken and yet the security cheques were Digitally signed Page 20 of 24 TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:53:03 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 not returned by Complainant; noted that:
"In order to rebut the presumption under Section 139 of N.I. Act, the Accused, by cogent evidence, has to prove the circumstance under which cheques were issued. It was for the Accused to prove if no loan was taken why he did not write a letter to the Complainant for return of the cheque. Unless the Accused had proved that he acted like a normal businessman/prudent person entering into a contract he could not have rebutted the presumption under section 139 N.I. Act. If no loan was given but cheques were retained, he immediately would have protested and asked the cheques to be returned and if still cheques were not returned, he would have served a notice as Complainant. Nothing was proved in this case."
(emphasis supplied)
38.Similarly, the Hon'ble Supreme Court in Shree Daneshwari Traders v. Sanjay Jain & Anr., AIR 2019 SC 4003, observed that:
"the defence of the Respondent that though he made payment for the commodities/rice bags, the blank cheques were not returned by the Appellant-Complainant is quite unbelievable and unacceptable."
(emphasis supplied)
39.Moreover, recently, the Hon'ble Supreme Court in APS Forex Case (supra) has Digitally signed Page 21 of 24 TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:53:22 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 noted that:
"However, to rebut the presumption, the Accused was required to lead the evidence that full amount due and payable to the Complainant has been paid. In the present case, no such evidence has been led by the Accused. The story put forward by the Accused that the cheques were given by way of security is not believable in the absence of further evidence to rebut the presumption."
(emphasis supplied)
40.In view hereof, the contention of the Accused qua payment of the loan amount, in absence of any cash receipts; absence of legal action/communication seeking return of the security cheques; and in light of failure of DW-1 to depose as to the details of the time/date of re-payment of the loan amount; the defence of the Accused is only by way of mere/bare denial and does not inspire confidence from the stand point of a reasonable man.
41.Further, if payment was made by the Accused to the Complainant in cash and nothing remained under the loan agreement which was executed in the writing, it does not appear reasonable for the Accused not to issue any stop payment instructions to the bank or not to take any legal steps seeking return of the cheque in question or reporting the loss or misplacement of the cheque in question to prevent its misuse, especially for an educated person, such as the Accused. It is also to be seen that if the cheque in question was issued as security cheque as Digitally signed Page 22 of 24 TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:53:40 +05'30' Rina Ari v. Prosenjit Kumar Dey CC No.633627/2016 per the Accused, as deposed by him on 06.04.2018, why was the said cheque in question not mentioned in the loan agreement/undertaking, Ex. CW1/2, if the hand-over of the same was contemporary to the execution of the said agreement.
42.Further, while the payment of Rs. 33,000/- by the Accused to the Complainant is not in dispute; it is seen that the said payment does not take away the liability of the Accused under the present cheque as it is the case of the Accused himself, that the said payment was towards interest. As per clause 4 of Ex. CW1/2, the Accused was required to pay interest at the rate of 10,000/- per month to the Complainant, which was in addition to the refund of the principal amount. In fact, the transaction of Rs. 33,000/- by the Accused on 19.11.2015 only goes to strengthen the case of the Complainant that the loan agreement was extended beyond the period of 12 months, since if the agreement was terminated in May, 2015, the question of payment being made by the Accused in November, 2015, does not arise. However, the Complainant has not been cross examined in the present case and hence no details of the repayment albeit in cash have been put to the Complainant nor has the Complainant been cross examined on the said aspect. Additionally, details of repayment such as mode of repayment, date of repayment, place where amount repaid, person in front of whom the loan was repaid, etc. have not been deposed by the Accused. Further, where the loan agreement was itself in writing, payment of the loan amount in cash, without any receipt, also does not seem credible from the point of view of a reasonable man. Digitally signed Page 23 of 24
TWINKLE by TWINKLE
CHAWLA
CHAWLA Date: 2022.08.31
16:53:58 +05'30'
Rina Ari v. Prosenjit Kumar Dey
CC No.633627/2016
Hence, this defence of the Accused also does not inspire confidence from the point of view of reasonable manner.
Conclusion:
43.In these circumstances and in view of the above detailed discussion, this court is of the considered opinion that the Accused has failed to rebut the presumption under Section 139 of Negotiable Instruments Act, 1881 in favour of the Complainant and ingredients of Section 138 of Negotiable Instruments Act, 1881 are fully proved. Therefore, Accused is held guilty and convicted for commission of offence punishable under Section 138 of the Negotiable Instrument Act, 1881. Let he be heard on the quantum of sentence on 13.09.2022.
ORDER: CONVICTED Digitally signed TWINKLE by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:54:17 +05'30' Announced in Open Court (Twinkle Chawla) MM (NI-Act 02), South East Saket Court, New Delhi Note: This judgment contains 24 pages and each page has been signed by me.
TWINKLE Digitally signed by TWINKLE CHAWLA CHAWLA Date: 2022.08.31 16:54:34 +05'30' (Twinkle Chawla) MM (NI-Act 02), South East Saket Court, New Delhi Page 24 of 24