Delhi District Court
CT CASES/613751/2016 on 23 January, 2023
Promark Technologies Pvt. Ltd. v. Shri Ashok Jha
CC No.613751/2016
IN THE COURT OF MS. TWINKLE CHAWLA: MM, NI ACT-02, SOUTH-
EAST DISTRICT, SAKET COURTS COMPLEX: NEW DELHI
Promark Technologies Pvt. Ltd. v. Shri Ashok Jha
CC No.613751/2016
U/s 138 Negotiable Instruments Act, 1881
1. CIS number : DLSE020009372014
2. Name of the Complainant : Promark Technologies Pvt. Ltd.
3. Name of the Accused, : Sh. Ashok Jha, S/o Sh. Dashrat Jha, R/o H.
parentage & residential No. L-I-1783A/29/3, Sangam Vihar, New
address Delhi - 110062.
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 : ACQUITTAL
7. Date of judgment/order : 23.01.2023
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 Accused and his son had approached the Complainant company and Page 1 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 requested for a loan of Rs. 3,00,000/- vide his application dated 15.06.2010 from the Complainant company stating that they needed money to make payment for purchase of a house; and assured that he would repay the loan amount of Rs. 3,00,000/- to the Complainant as per agreed terms.
2. A loan agreement dated 22.06.2010 was executed between the Complainant company and the Accused, whereby the Accused agreed to repay the said loan alongwith interest at the rate of 12% per annum in monthly installments and also pledged property documents with the Complainant company.
3. Thereafter, an amount of Rs. 3,00,000/- was advanced by the Complainant company to the Accused by way of cheque bearing no. 551283, drawn on South Indian Bank Ltd., dated 22.06.2010. However, as per the Complainant the Accused did not pay any monthly installment and after repeated requests, the Accused in discharge of the aforesaid liability, issued a cheque bearing No. 947448, dt. 21.04.2014, amounting to Rs. 3,00,000/-, drawn on Bank of Baroda, Defence Colony, New Delhi in favour of the Complainant ('Cheque in question').
4. Upon presentment, the cheque in question was returned unpaid on ground of account closed, by way of return memo dt. 05.05.2014.
5. The Complainant sent the legal demand notice dated 31.05.2014 through speed post at the 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 Page 2 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 Complainant filed the present complaint.
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 12.08.2014.
7. Accused appeared and was released on bail on 08.12.2014. On finding a prima facie case, notice U/s 251 of the Criminal Procedure Code, 1973 ("CrPC") was served upon the Accused on 01.04.2015 to which he pleaded not guilty and opted to contest after disclosing the following defence:
"I do not plead guilty and claim trial. I have already repaid the loan amount. When I had procured the loan Complainant company had asked me to give a blank signed cheque as a guarantee for repayment and same shall be used only if I am unable to repay the amount. Since, I have already repaid the loan hence, I am not liable to pay the cheque amount."
8. Vide order dated 01.04.2015 opportunity was granted to the Accused to cross examine the Complainant. The Complainant/CW1 adopted his pre-summoning evidence affidavit, Ex. A1 and also proved following documents:
Ex. A: Board Resolution dated 15.05.2014 in
favor of the AR of the Complainant namely
Sh. Pavan Tandon.
Ex. B: Loan agreement dated 22.06.2010
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Promark Technologies Pvt. Ltd. v. Shri Ashok Jha
CC No.613751/2016
executed between the Complainant and the
Accused.
Mark A: Documents of property as pledged by
Accused with the Complainant.
Ex. D: Original Cheque bearing no. 947448, dated
21.04.2014, amounting to Rs. 3,00,000/-.
Ex. E: Original return memo dated 05.05.2014.
Ex. F: Copy of legal demand notice dated
31.05.2014.
Ex. F1: Original Postal receipt in respect of the
legal demand notice.
Ex. G: Internet generated tracking report in
respect of legal demand notice.
Ex. H: Return envelope in respect of legal demand
notice.
Ex. I: Documents of property as pledged by
Accused with the Complainant.
9. Complainant Evidence was closed by way of court order at the request of Ld. Counsel for the Complainant, on 15.05.2019.
10.Thereafter, Accused was examined under Section 313 of CrPC on 15.05.2019 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 opted to lead evidence in his defence.
11.As part of defence evidence, the Accused examined one Sh. Deepak Kumar, Manager Regent Garage Pvt. Ltd as DW-1, who deposed in favor of the Accused and brought on record repair order dt. 13.04.2013, Ex. DW1/1 (OSR); and himself Page 4 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 as DW-2 and produced copy of complaint made to police, Ex. DW2/A and copy of case filed before Labour Court, Mark D1.
12.Thereafter, DE was closed by way of separate statement of the Accused on 01.09.2022.
13.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
14.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.
15.Per contra, Ld. Counsel for the Accused has submitted that the Accused deserves to be acquitted as the Accused has already repaid the loan amount to the Complainant and the cheque in question has been misused by the Complainant. It has further been submitted that since the Accused had lodged complaints against the Complainant before the police and the labour authority, the said cheque has been misused. Hence, as per the Ld. Counsel for the Accused, the Accused has rebutted the presumption by way of preponderance of probabilities. Page 5 of 17
Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 Legal Framework Ingredients of Section 138 NI Act:
16.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;
(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 1 Reduced to three months vide RBI circular dated 4.11.2011. Page 6 of 17
Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 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."
17.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:
18.Section 139 NI Act states that:
"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"
19.Section 139 NI Act is a type of reverse onus clause, which stipulates a presumption 2 The same is now enhanced to 30 days.
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Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 in the favour of the Complainant as to fact of a cheque being received in discharge of a legal debt or liability.
20.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;"
21.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.
22.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 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; 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 Page 8 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 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;
(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 Page 9 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 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
23.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 he is the signatory of the same. Presentation of the cheque in question by the Complainant and its dishonour on grounds of account closed is also not in dispute. The receipt of the legal demand notice has also been admitted by the Accused in statement U/s. 313 CrPC.
24.Thus, the legal demand notice Ex. F is held to have been duly served upon the Accused. Finally, the complaint has been filed within the limitation period. Page 10 of 17
Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 Therefore, essential ingredients (i) to (v) as stipulated by the Hon'ble Supreme Court in Kusum Ingots Case (supra), have been duly satisfied.
25. 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 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 cheque in question was given as a blank signed cheque and the particulars on the same have been filled by or at the instance of the Complainant. At this stage, reliance can be laid on the observations of the Hon'ble Supreme Court 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 Page 11 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 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 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)
26.The same view has been endorsed by the Hon'ble High Court of Delhi in Ravi Chopra v. State, CRL.M.C. 5211/2006.
27.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 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 Page 12 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 a presumption.
28.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 for dislodging the presumption which meets the standard of preponderance of probabilities.
29.The Accused in the present case, has taken the following line of defence with a view to rebut the presumption:
(a) Absence of liability qua the cheque in question:
30.In the present case, the defence of the Accused is that while the loan of Rs. 3,00,000/- was taken from the Complainant in 2010, the same has been repaid by him and hence there is no liability towards the cheque in question. Further, the Accused has also submitted that he was a driver of the Complainant company and hence the said loan was advanced to him; and that the loan was repaid by way of deductions made on the monthly basis from the salary and he had also paid am amount of Rs. 50,000/70,000/-, 2-3 times. It has been submitted that the entire amount of Rs. 3,00,000/- was paid by the Accused by November/December 2013. In order to prove the fact of his employment with the Complainant company, the Accused has brought on record a letter issued by the Complainant company in favor Page 13 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 of the Accused, i.e., Mark D2, which was put to the AR of the Complainant in the cross examination. During cross examination of the AR of the Complainant dated 19.01.2019, when the said document Mark D2 (Mark B2) was put to the AR; the AR stated that he could not comment on the said document. The said document, Mark D2 appears to have prepared on the letter head of the Complainant company and also bears the company seal/stamp. Despite the said documents having been brought on record by the Accused, no question on its veracity/validity has been raised by the Complainant throughout the trial. Furthermore, the Accused has also examined as DW1, one Sh. Deepak Kumar who was working as a Manager at Regent Carriage Pvt. Ltd., who has also deposed that the Accused was the driver of the Complainant company who used to bring the car of the Complainant company for repair.
31.Further, detailed cross examination of the Accused and DW1 has not been conducted by the Ld. Counsel for the Complainant on the point of employment; and mere suggestion as to the Accused not being an employee of the Complainant Company, has been put. Hence, the Accused has been able to fairly establish that he was employed with the Complainant company.
32.Further, perusal of the contents of Mark D2 also show that for the payment of previous loan which was taken by the Accused from the Complainant in 2006, deductions were made on monthly basis of a certain amount from the Accused's salary by the Complainant.
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Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016
33.While the loan in question pertains to 2010 and the letter Mark D2 does not pertain to the present loan; the fact that previously the Complainant company resorted to monthly deduction from salary as a mode of repayment of loan, probablises the defence of the Accused in the present case as well that the present loan was partly repaid by way of deduction from monthly salary. It is also pertinent to note that the loan agreement, Ex. B which has been executed between the parties qua the loan in question, does not mention either the number of monthly installments, or the amount of each monthly installment or the tenure of the loan or the mode of payment; which again shows that the payment was to be made, as decided as between the parties. Hence, it is possible for the Accused to have partly repaid the loan by way of monthly deduction made in the salary; and partly by way of payments made in the omnibus manner. While the Accused has in his examination in chief, stated that he has paid Rs. 50,000/70,000/-, 2-3 times and the rest of the amount was deducted monthly from the salary; no detailed questioning has been conducted by the Complainant on this point of repayment and only two suggestions have been put to the Accused that no repayment was made by him and that the Accused does not have any document to prove the repayment. However, since the Accused has established to a certain extent an employer-employee relationship between the Complainant and the Accused; the same could also be a reason behind the Accused not having any receipt of repayment.
34.Further, while it is the case of the Complainant itself that as surety for the loan in Page 15 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 question, original documents of a property owned by the Accused were given by the Accused to the Complainant; the Complainant company has not brought on record the original documents despite express questioning and the AR of the Complainant has stated that he is not in a position to bring the said documents on record, in his cross-examination. A suggestion has then been given by Ld. Counsel for the Accused that since the loan had been repaid by the Accused, the original documents were returned to the Accused, and hence, the same are not in the possession of the Complainant. However, apart from denying the same, no explanation for non-production of the original documents by the AR of the Complainant, has come on record or even been given. This conduct again probabilises the defence of the Accused as to repayment of the loan.
35.It is trite law that while the Accused has to discharge his burden by preponderance of liability, it is the Complainant who has to establish his case beyond all reasonable doubt. Hence, the Accused has been able to prove the repayment of the loan amount by the standard of preponderance of probabilities; and by proving to an extent that he was an employee of the Complainant company, he has also impeached the credibility of the AR of the Complainant, who had denied the fact of employment throughout the complaint and during his cross-examination. Conclusion:
36.In these circumstances and in view of the above detailed discussion, this court is of the considered opinion that the Accused has successfully rebutted the presumption Page 16 of 17 Promark Technologies Pvt. Ltd. v. Shri Ashok Jha CC No.613751/2016 under Section 139 of Negotiable Instruments Act, 1881 in favour of the Complainant and ingredients of Section 138 of Negotiable Instruments Act, 1881 have not been fully proved. Therefore, Accused is held not guilty and is acquitted for commission of offence punishable under Section 138 of the Negotiable Instrument Act, 1881.
ORDER: ACQUITTAL
Announced in Open Court (Twinkle Chawla)
MM (NI-Act 02), South East
Saket Court, New Delhi
Note: This judgment contains 17 pages and each page has been signed by me.
(Twinkle Chawla) MM (NI-Act 02), South East Saket Court, New Delhi Page 17 of 17