Delhi District Court
Sh. Dinesh Bhatia vs Sh. Khem Singh on 18 February, 2017
IN THE COURT OF SH. GURVINDER PAL SINGH
ADDITIONAL DISTRICT JUDGE01 (CENTRAL)
TIS HAZARI COURTS, DELHI
C.S. No. 15679/2016
Sh. Dinesh Bhatia,
S/o Late Sh. Suraj Prakash Bhatia,
R/o B581, Gali No2, Ganesh NagarII,
Shakarpur, Delhi110092.
......Plaintiff
Versus
Sh. Khem Singh,
S/o Sh. Devi Singh,
R/o B1694, Jalebi Chowk,
Shastri Nagar, Delhi110052.
.......Defendant
SUIT FOR RECOVERY OF RS. 4 LAKHS WITH INTEREST
Date of institution of suit : 13.04.2015
Date of reserving the judgment : 21.01.2017
Date of pronouncement of judgment : 18.02.2017
CS15679/2016
Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 1 of 17
JUDGMENT
1.The plaintiff has filed the present suit for recovery of Rs. 4 Lakhs alongwith interest against the defendant. Adumbrated in brief the facts of the case of plaintiff are as follows. The defendant was having friendly relations with the plaintiff for the last several years. It has been averred that in the month of March 2012, the defendant approached the plaintiff for a friendly loan of Rs. 4 Lakhs for some construction work at his house. The plaintiff gave Rs. 2 Lakhs in cash on 15.03.2012 and Rs. 2 Lakhs in cash on 30.03.2012 to the defendant on his assurance that the said loan would be paid by the defendant within three months. Also has been averred that after expiry of of three months, when plaintiff asked the defendant for return of aforesaid loan amount, the defendant requested for some more time and assured to return the said loan amount in another two months. Thereafter, plaintiff visited several times to defendant's place and on the request of plaintiff, the defendant in the month of January, 2013 issued a post dated cheque of Rs. 4 Lakhs, bearing no. 048993, dated 01.04.2013, drawn on ICICI Bank, Gurgaon Branch, in CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 2 of 17 discharge of his legal liability and assured the plaintiff that the said cheque would be encashed upon presentation. However, in the last week of March 2013, the defendant again approached the plaintiff and requested the plaintiff to deposit the said cheque after few days from the date of the cheque and accordingly the plaintiff presented the said cheque to his banker viz., Punjab National Bank, Madhuban, Delhi110092, on 01.06.2013, but the said cheque was returned dishonored vide cheque return memo, dated 03.06.2013 with remarks "Insufficient Funds". It has also been averred that since the defendant failed to make the payment of afore elicited loan amount despite several requests of the plaintiff, the plaintiff got issued a legal demand notice on 13.06.2013 through his Counsel to the defendant by courier. Despite service of legal notice, the defendant failed to return the aforesaid loan amount. Hence, this suit. Even, plaintiff initiated the proceedings under Section 138 of Negotiable Instruments Act, 1881.
2. In the filed written statement, the defendant took preliminary objections viz., (i) suit of plaintiff was a sheer misuse of the process of law and had been filed to cause mental harassment and torture to the CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 3 of 17 defendant and to extract money; (ii) suit was without any cause of action;
(iii) there was no privity of contract between the parties; and (iv) plaintiff had not approached this Court with clean hand and had suppressed the material facts. Defendant averred that the plaintiff was actively connived with Sh. Rakesh Arora, with whom the defendant was in litigating terms. Said Sh. Rakesh Arora had obtained a number of blank cheques (including the cheque in question) from the defendant, his father and other family members for security purposes to have a loan from some financial institution(s). On receipt of information with regard to presentation of the cheque in question with the banker of the defendant, the defendant made a call to the Police Control Room No. 100 and afterwards a legal notice dated 03.06.2013 was issued to said Sh. Rakesh Arora. The defendant also filed a written complaint in this regard at Police Station Sarai Rohilla, Delhi, vide DD No. 89B, dated 03.06.2013. Also has been averred that the plaintiff had obtained the cheque in question in blank condition from said Sh. Rakesh Arora and filled the same as they desired with a view to drag the defendant in false and frivolous suit and complaint. It is the averment of the defendant that the cheque in question was not issued by the defendant. It has been further CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 4 of 17 averred that the defendant had replied the legal notice vide its reply dated 26.06.2013, sent through speed post to the Counsel for plaintiff and the plaintiff on 27.06.2013. Defendant vehemently denied of having any friendly relations with the plaintiff or obtaining any of loan of Rs. 4 Lakhs from the plaintiff. Also has been averred that the cheque in question was never issued to the plaintiff by the defendant against any type of liability. Defendant vehemently denied of having any liability to make the payment of Rs. 4 Lakhs alongwith interest to plaintiff, as claimed. Defendant denied the averments of the plain in toto and in particular. Defendant prayed for dismissal of suit with heavy and exemplary costs.
3. Plaintiff filed rejoinder to the written statement of the defendant to controvert the contention of the written statement and to reiterate the averments of the plaint.
4. From the pleadings of the parties, following issues were framed vide order dated 25.08.2015 : CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 5 of 17 ISSUES
1)Whether there existed privity of contract between the parties to the suit? OPP
2)Whether the plaintiff is entitled for recovery of sum claimed from defendant?
OPP
3)Whether the plaintiff is entitled to any
interest? If so, at what rate and for which
period? OPP
4)Relief.
5. In evidence, plaintiff examined himself as PW1 vide affidavit Ex PW1/1. PW1 relied upon documents i.e., (i) cheque bearing no. 048993, dated 01.04.2013, drawn on ICICI Bank, Gurgaon Branch exhibited as Ex PW1/A; (ii) cheque returning memo dated 03.06.2013 exhibited as Ex PW1/B; (iii) legal demand notice exhibited as Ex PW1/C; (iv) courier receipt exhibited as Ex PW1/D; and (v) proof of delivery exhibited as Ex PW1/E. PW1 was crossexamined.
CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 6 of 17
6. Defendant examined himself as DW1 vide affidavit Ex DW1/A. DW1 relied upon documents i.e., (i) legal notice dated 03.06.2013 and postal receipts exhibited as Ex DW1/1 and Ex DW1/2;
(ii) reply dated 06.07.2013 of Sh. Rakesh Arora exhibited as Ex DW1/3;
(iii) complaint dated 03.06.2013, filed against Sh. Rakesh Arora and its postal receipt exhibited as Ex DW1/4 and Ex DW1/5; (v) reply dated 26.06.2013 and its postal receipts exhibited as Ex DW1/6 to DW1/9; (vi) response of Sh. Rakesh Arora, dated 06.07.2013 and its envelope exhibited as Ex DW1/10 and Ex DW1/11. DW1 was crossexamined.
7. I have heard arguments addressed by Sh. Prashant Sharma, Ld. Counsel for plaintiff; Sh. Rajeev Mehra, Ld. counsel for defendant and have given thoughts to the rival contentions put forth; pleadings of the parties; evidence, relied precedents and have also examined the record of the case.
8. Ld. counsel for defendant has relied upon : CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 7 of 17 (1) Hiralal & Ors. Vs. Badkulal & Ors., AIR 1953 Sup. Court 225 [Vol. 40, C.N. 54];
(2) Agurchand Bhomraj Sowear Vs. Deochand & Anr., AIR 1960 Andhra Pradesh 101 (V 47 C 34);
(3) Rangabati Vs United Bank of India Ltd., AIR
1961 Patna 158 (V 48 C 42).
9. My issue wise findings are as under :
Since, issues no1 and 2 are interconnected so they are being taken up together.
Findings on Issues No(1) & (2)
1)Whether there existed privity of contract between the parties to the suit? OPP
2)Whether the plaintiff is entitled for recovery of sum claimed from defendant?
OPP CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 8 of 17 Put forth version of plaintiff PW1 in his plaint and affidavit Ex PW1/1 had been of having friendly relations with defendant and having given to defendant Rs. 2 Lakh in cash on 15.03.2012 and another Rs. 2 Lakh in cash on 30.03.2012 as friendly loan since the defendant in the month of March 2012 had approached plaintiff/PW1 expressing his desire for need of money for some construction work at his house. Loan was repayable within three months but not so paid and two months more time was sought by defendant. Later on, after expiry of extension period of two months and several visits of plaintiff to defendant's place, in the month of January 2013, the defendant issued a post dated cheque Ex PW 1/A, bearing no. 048993, drawn on ICICI Bank, Gurgaon Branch, dated 01.04.2013 amounting to Rs. 4 Lakh in discharge of his legal liability and assured the plaintiff/PW1 that said cheque will be encashed upon presentation. On presentation of the cheque, it was dishonoured vide return memo Ex PW1/B, dated 03.06.2013 with remarks "Insufficient Funds." Defence of defendant had been that he did not have any privity of contract with the plaintiff. Also is the version of defendant/DW1 that DW1 was having previous litigation with one Sh. Rakesh Arora and said CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 9 of 17 Sh. Rakesh Arora with the help of number of persons including plaintiff launched a litigating war with the defendant. Also is the version of defendant that number of blank cheques from defendant, father of defendant and other family members of defendant were obtained by said Sh. Rakesh Arora for security purpose to have a loan. Cheque Ex PW 1/A is stated by defendant to have been received by said Sh. Rakesh Arora in the mode and manner stated above. Upon receipt of call from banker, DW1 made call to Police Control Room at number 100 and then got issued legal notice Ex DW1/1, dated 03.06.2013 to aforesaid Sh. Rakesh Arora to treat the cheque Ex PW1/1 as null and void. Said Sh. Rakesh Arora gave reply Ex DW1/3, dated 06.07.2013, whereby it was denied by said Sh. Rakesh Arora of having obtained any cheques from defendant, his father or family members for security purpose to have a loan from financial institutions, as alleged by the defendant. It is also the case of the defendant/DW1 that he filed a written complaint, dated 03.06.2013 Ex DW1/4, simultaneous to the issuance of the notice Ex DW1/3 against said Sh. Rakesh Arora to SHO PS Sarai Rohilla, Delhi, which was received in said police station and recorded in Daily Diary No. 89B of date 03.06.2013. Also is the version of the defendant that he CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 10 of 17 received legal notice of plaintiff through Counsel Ex PW1/C, dated 12.06.2013, to which through Counsel he got sent reply, Ex PW1/DX1, dated 26.06.2013. Reply Ex DW1/10, dated 06.07.2013 was sent by Counsel for said Sh. Rakesh Arora incorporating version of defendant to be incorrect, making it implicit clear that said Sh. Rakesh Arora had no concern with Cheque Ex PW1/A besides also having no concern with the loan taken by defendant or his father. Defendant/DW1 has projected that his blank cheque was misused by plaintiff with the connivance of said Sh. Rakesh Arora and cheque Ex PW1/A was never issued by defendant in favour of PW1 against any liability.
10. In Ex DW1/A in Para9, the defendant had interalia asserted that : "the writing of the deponent (defendant) on the said cheque, in the shape of signature, is available on the said cheque, which is already Ex PW1/A at point 'A' but the column of drawee, date, amount in words and figure, were blank, when the said cheque was took away by said Sh. Rakesh Arora in the manner as mentioned hereinabove."
CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 11 of 17 Earlier, in notice Ex DW1/1 and complaint Ex DW1/3, it was the stand of defendant that defendant had given to said Sh. Rakesh Arora cheque Ex PW1/A having blanks at the columns of Rupees in writing and figure, where the figure of the intended drawing amount is used to be mentioned. Though in the affidavit Ex DW1/A, the defendant admitted his signatures on the cheque Ex PW1/A but when DW1 was crossexamined by plaintiff's Counsel and the cheque Ex PW1/A was put before DW1, then defendant/DW1 point blank denied signatures at portions then marked as X and Y on cheque Ex PW1/A to be not belonging to him. DW1 further elicited that before dishonour of cheque Ex PW1/A, he did not report the matter to police nor filed complaint before any authority. When police did not register any First Information Report on complaint of DW1, DW1 did not file any complaint case before Magisterial Court against plaintiff or Sh. Rakesh Arora for misuse of cheque Ex PW1/A. DW1 has testified the fact of his signatures on cheque Ex PW1/A in contradiction, as elicited above. Even, DW1 did not report the matter to police before dishonor of the cheque nor did he file any complaint case against said Sh. Rakesh Arora for any misuse of CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 12 of 17 cheque Ex PW1/A. Written statement of defendant is bereft of material facts as to on which date, month or year and at what place the defendant ever entrusted the cheques including cheque Ex PW1/A to said Sh. Rakesh Arora and to all those facts and their complete details as to how defendant was induced by said Sh. Rakesh Arora to deliver those cheques including Ex PW1/A.
11. It is own assertion of the defendant/DW1 that he had been dragged into litigation by said Sh. Rakesh Arora but neither defendant/DW1 has pleaded the complete particulars of said litigation(s) nor proved the same. The precedents relied upon by defendant, detailed in the earlier part of the judgment, are of raising of presumption of adverse inference for nonproduction of relevant documents/evidence by a party in terms of illustration (g) of Section 114 of Evidence Act. In the fact of the matter, it is the defendant/DW1, who did not plead nor proved any other litigation with regard to the alleged misuse of issued cheques purportedly for security for availing loan from financial institutions, by said Sh. Rakesh Arora. Fact situation impels me to draw adverse inference against the defendant in the fact of the matter accordingly.
CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 13 of 17 Relied upon precedents are of no help to defendant for carving out adverse inference against the plaintiff for nonproduction of the account books and Income Tax Returns as in his deposition in crossexamination, PW1 himself stated of having not shown the loan of Rs. 4 Lakhs given by him to defendant in his Income Tax Return. PW1 elicited that he had sold one property from where he had received the money and out of that he had paid Rs. 4 Lakhs as loan to defendant. He has further elicited the description of said sold property to be : "B581, Ganesh NagarII, Shakarpur, Delhi92."
12. Dishonour memo Ex PW1/B embodies the reason of dishonour as "Insufficiency of Funds" and not any difference of signatures or signatures on cheque Ex PW1/A to be not of the account holder. No law prescribes that the writing in the body of the cheque is necessarily to be of the drawer of said cheque. In the fact of the matter, from the forgoing discussions, the defendant has failed to prove that he had delivered cheque Ex PW1/A to said Sh. Rakesh Arora for security for availing loan from financial institution or that it was misused by said CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 14 of 17 Sh. Rakesh Arora and/or given to plaintiff as alleged by defendant/DW1. Cheque Ex PW1/A bears the signatures of defendant. Presumption in favour of holder under Section 139 of Negotiable Instruments Act, 1881, (in short NI Act), impels me to presume that the holder of the cheque i.e., the plaintiff received the cheque of the nature referred to in Section 138 of NI Act for the discharge, in whole or in part, of any debt or other liability of defendant/DW1. Such rebuttable presumption in favour of plaintiff/ PW1 has not been rebutted by the defendant/DW1 by adducing relevant evidence. Mere no mention of loan in Income Tax Return by plaintiff would not entitle defendant to wriggle out from his liability towards plaintiff for payment to aforesaid loan. In fact, from the appreciation of the testimony of defendant/DW1, as aforesaid, it is clear that defendant/ DW1 is not a reliable witness as in his version in affidavit Ex DW1/A he asserted of having signed the cheque Ex PW1/A but in crossexamination had altogether denied the signatures at PointX and Y on Ex PW1/A to be of him.
13. By preponderance of probabilities, the plaintiff has been able to prove of having advanced the friendly loan, as alleged to defendant and CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 15 of 17 later having received the cheque Ex PW1/A in discharge of his liability, on presentation of which it was dishonoured. Accordingly, there existed privity of contract between the parties to the suit. Plaintiff is entitled for the recovery of sum of Rs. 4 Lakhs from defendant. Issues no1 and 2 are decided in favour of plaintiff and against the defendant.
Findings on Issue No(3) Whether the plaintiff is entitled to any interest? If so, at what rate and for which period? OPP
14. In view of my above findings with respect to issues no1 and 2, plaintiff is entitled for recovery of sum of Rs. 4 Lakhs from defendant. Having advanced the friendly loan, as alleged to defendant and later having received the cheque Ex PW1/A in discharge of his liability, on presentation of which it was dishonoured, defendant is liable to pay interest on sum of Rs. 4 Lakhs. Interest has to be granted keeping in view the economic standards of country and the conduct of the parties. In my view, accordingly, interest @ 12% per annum from date of filing of suit till realization would be appropriate and reasonable.
CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 16 of 17 RELIEF
15. In view of my findings with respect to above issues no. 1 to 3, suit of the plaintiff is decreed in terms that plaintiff is entitled for recovery of a sum of Rs.4 Lakhs from defendant with interest @ 12% per annum from the date of filing of the suit till realization. The proportionate costs of the suit are also allowed in favour of the plaintiff. Decree sheet be prepared and file be consigned to record room.
Announced in open Court (GURVINDER PAL SINGH) on 18th Day of February, 2017. Additional District Judge01 (Central) Tis Hazari Courts, Delhi.
(AD) CS15679/2016 Sh. Dinesh Bhatia Vs. Sh. Khem Singh Page 17 of 17