Delhi District Court
Sh. Mohit Gupta vs . Sh. Mohinder Singh on 9 November, 2021
IN THE COURT OF MS AISHWARYA SINGH KASHYAP,
METROPOLITAN MAGISTRATE (NI ACT),
KARKARDOOMA COURTS, DELHI
SH. MOHIT GUPTA Vs. SH. MOHINDER SINGH
CC NO. 2465/2017 [Ghazipur]
CNR Number: DLET020049242017
Sh. Mohit Gupta
S/o Shri Madan Lal Gupta,
R/o 1184, Block A, Dairy Farm,
Gharoli, Delhi-110096 .......... Complainant
Vs
Sh. Mohinder Singh
S/o Sh Anand Singh, R/o H.No.9-C, Pocket B4, Mayur Vihar
Phase III, Vasundhra Enclace, Delhi- 110096
Also at
B-1/4C, Mayur Vihar, Phase III, Near Ryan International School,
Delhi-110096 .........Accused
Complaint Case No.: 2465/2017
Date of Institution: 29.07.2017
Offence alleged: Section 138 Negotiable Instruments Act,
1881
Plea of the accused: Pleaded not guilty (Security Cheque/No
Liability)
Final Order: Convicted
Date of Decision: 09.11.2021
Argued By:
Ld. Counsel for the Complainant- Shri Ravi Kumar
Ld. Counsel for the Accused- Shri Rajesh Lathigara
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP
Date: 2021.11.09
KASHYAP 11:09:30 +05'30'
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Mohit Gupta vs Mohinder Singh CC No 2465/2017
JUDGEMENT
Factual Matrix
1. The complaint is based on alleged facts that the parties are known to each other wherein, Shri Mohit Gupta (hereinafter 'the complainant') advanced a friendly loan of Rs 1.50 lakhs to Sh. Mohinder Singh (hereinafter 'the accused'), and two cheques issued by the accused for purported payment of aforesaid friendly loan were dishonoured, thus committing the offence under Section 138 of the Negotiable Instruments Act, 1881(hereinafter 'The Act'). It is the case of the complainant that the accused approached him in February, 2016 on account of financial distress. On 20th February, 2016 the complainant advanced a friendly loan to the accused for an amount of Rs. 1.50 lacs for a period of one year; the accused executed a signed cash receipt against the friendly loan the same day. After the elapse of one year, upon being approached by the complainant for payment of loan, the accused handed over two duly signed post dated cheques to the complainant bearing cheque nos. 127183, dated 02.05.2017, for an amount of Rs.50,000/-, and cheque no. 127186, dated 20.04.2017, for an amount of Rs 1 lakh respectively, both drawn on Punjab National Bank, Mayur Vihar, Phase III, Delhi (hereinafter, 'the cheques in question'). The same were dishonoured (twice) with remarks "Kindly Contact Drawer Bank" vide return memos dated 20.05.2017 and later with remarks "Funds Insufficient" vide return memos dated 12.06.2017. The complainant served legal demand notice on the accused dated 30.06.2017, on both the addresses, and on failure Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:09:43 +05'30' 2 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 of the accused to pay the amount within 15 days, filed the instant complaint within the period of limitation.
Pre-summoning Evidence, Cognizance and Notice
2. Pre-summoning evidence was led by the complainant and after consideration, the Ld. Predecessor took cognizance and issued summons vide order dated 29.07.2017. The accused entered appearance and notice under Section 251 of the Code of Criminal Procedure, 1973 (hereinafter, 'CrPC') for the offence under Section 138 of the Act was served upon accused on 15.10.2018, to which he pleaded not guilty and claimed trial. In his plea of defence, the accused pleaded as under:-
Admission and Denial/Plea of Defence Taken by the Accused
1. It is correct that the cheque in question bears my signature, name of my bank and my account number. However, I did not fill the body of the cheque in question.
2. I had given cheques in question to the complainant as security because I have taken Rs50,000/- from him on interest. I had repaid the said amount to the complainant alongwith due interest against written acknowledgement. I have never taken any other amount from the complainant in my life so far.
3. I did not receive legal demand notice issued by the complainant.
Complainant's Evidence
3. During the trial, the complainant has led the following oral and documentary evidence against the accused to prove his case beyond reasonable doubt.
Oral Evidence I. CW1: Sh. Mohit Gupta, the complainant on 14.01.2019 & 17.09.2019 Documentary Evidence I. Ex. CW1/A: Signed Receipt II. Ex. CW1/B & C: Cheques in Question Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:09:56 +05'30' 3 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 III. Ex. CW1/D& E: Return Memos (20.05.2017) IV. Ex. CW1/F& G: Return Memos (12.06.2017) V. Ex. CW1/H: Legal Demand Notice VI. Ex. CW1/I & J: Postal Receipts VII. Ex. CW1/K& L: Tracking report X. Ex. CW1/1: Pre-summoning evidence by way of affidavit by the complainant.
4. In his cross-examination, the complainant supported the version stated in the complaint and evidence affidavit pertaining to the transaction wherein, the deposition revealed the following relevant facts:-
i). The complainant ran a cloths' shop at A-1184, Mayur Vihar, Phase III, Delhi in the name of 'Kaira Collection' alongwith his wife; ii). The loan amount was advanced in cash out of personal savings; iii). The complainant denied the suggestion that he advanced short term loan to people in the name of Tirupati Group via three collection agents Rohtash, Roshan and Praveen Gupta;
iv). The complainant denied the suggestion that he issued cards against advancing such loans and/or that loan of Rs 50,000/- paid to the accused was returned by him as per said card/Mark X (photocopy); v). The complainant denied the suggestion that he filled the body of the signed blank cheques and deposed that accused himself handed over duly filled signed cheques; vi) The complainant denied the suggestion that he got the cash receipt Ex CW1/A typed/prepared/fabricated and deposed that accused himself brought the said document; vii) There were no eye-witnesses to the transaction at the time of advancing loan;
AISHWARYA Digitally signed by
AISHWARYA SINGH
SINGH KASHYAP 4 of 18
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viii) The cheques were said to be given by the accused after an elapse of one year from the date of advancing the loan, not at the time of loan itself. The complainant denied the suggestion that he did not advance friendly loan of 1.5 lacs to the accused. CE was closed on 17.09.2019 and the matter was listed for recording of the statement of accused.
Statement of Accused
5. Thereafter, before the start of defence evidence, in order to allow the accused to personally explain the circumstances appearing in evidence against him, his statement under Section 313 CrPC was recorded without oath on 24.09.2019. Therein, the accused denied all the allegations against him and also changed his stance qua the signatures and denied having taken any loan from the complainant.
Interestingly, he stated as under:
"1. It is correct that the cheque in question belongs to me but it does not bear my signature. I did not fill the body of cheques in question.
2. No, I do not know the complainant.
3. No, I had not taken any loan from the complainant.
4. The present cheques in question were given for security purpose to Sh. Praveen Kumar Gupta, brother-in-law of the complainant, as my son used to take short term loan fo Rs. 10,000/-, Rs 20,000/- or Rs 50,000/- from him. My son had repaid the same to brother-in-law of the complainant. I do not have any liability towards the complainant.
5. I did not receive legal demand notice issued by the complainant."
It is pertinent to note that accused signed the statement in Hindi. Thereafter, the accused opted to lead defence evidence and matter was listed for DE.
Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP
SINGH KASHYAP Date: 2021.11.09 11:10:21
+05'30'
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Defence Evidence.
6. The accused moved an application under Section 315 CrPC whereby he was allowed to step into the witness box.
Oral Evidence
I. DW1: Sh. Mohinder Singh, the accused on
02.11.2019
II. DW2: Ms Aakansha on 04.12.2019 &
23.01.2019
Documentary Evidence
I. Ex. DW1/A: Tirupati Group Document
II. Mark X: Photocopy of Entries
His evidence was recorded on 02.11.2019. In his deposition, the accused abandoned his erstwhile plea of defence taken during serving of notice and reiterated his statement recorded under Section 313 CrPC albeit with certain modifications. In his chief- examination, the accused deposed as under:
"I did not knew (sic) the complainant but I knew Praveen Kumar, brother-in-law (jija) of the complainant. The brother-in-law of the complainant was working in a chit fund named Sachdeva Finances. He used to come for collection of daily wages from my son Rahul Sabbarwal. Praveen Kumar told that he alongwith the complainant was to start financing business in the name of Tirupati Group..Some transactions were going on between my son and the Tirupati Group. Therefore, I also engaged in the transaction and I issued a cheque for security being guarantor. I do not have any liability towards the complainant."
7. During his cross-examination, the accused denied the suggestions that he issued the cheques in question to the complainant against payment of liability/loan of Rs. 1.50 lakhs.
Digitally signed byAISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:10:33 +05'30' 6 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 The relevant portions of the deposition of the accused during his cross-examination is being reproduced as under.
"The entries on document Ex. DW1/A were made in my presence. I do not have any document to show that there was any relation between Sachdeva Finances and Tirupati Groups. (After perusal of Ex. DW1/A)..It is wrong to suggest that it does not bear the handwriting or signature of the complainant at Point A...It is wrong to suggest that the complainant has no dealings with Parveen...It is wrong to suggest that I issued two cheques to repay liability..It is wrong to suggest that Ex. DW1/A is forged and fabricated..."
However, despite being a material witnesses, the accused neither sought to bring on record his son who allegedly played key role in the short term loan transactions nor Sh Praveen Kumar/brother-in-law of the complainant who is alleged to have been repaid said short term loans by the son of the accused. Oddly, one Ms Aakansha deposed as DW2 on 04.12.2019 and 23.01.2020 however, her testimony does little-to- nothing to support the defence put forth by the accused. Her role as key witness was never explained by the accused at any stage prior to recording her evidence and she failed to produce the alleged material document to support her testimony. The relevant portions of her testimony are being reproduced as hereunder:
"I know the complainant as I am running my shop in the name of Divya Fashion Center near the shop of complainant. Complainant is running business of finance in the name of Tirupati Finance from the said shop along with Praveen. In the year 2016, I had taken loan of Rs 50,000/- from the complainant at 10% per month...The complainant had took my signature on one blank paper and a blank signed cheque from me in which accused was guarantor. I can produce the Card issued by the complainant...Complainant used to lend the loan to other persons also in similarly (sic) manner."
On 23.01.2020 "Today, I have not produced any document. ...I do not know the address of Tirupati Fiance. I do not know who is the owner of Tirupati Finance. I do not have any documentary Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP 7 of 18 SINGH KASHYAP Date: 2021.11.09 11:10:46 +05'30' Mohit Gupta vs Mohinder Singh CC No 2465/2017 proof to show that I had taken Rs 50,000/- in cash from the complainant.
I do not have any documentary proof to show that I had returned Rs 50,000/- in cash to the complainant...I have not filed any complaint or sent any legal notice to the complainant for non-returning of my cheque to me...Accused had taken Rs 1,50,000/- from the complainant and he had returned the same in my presence. I do not remember the exact date and month on which the payment was made and returned. The amount was given at the office of Tirupati Finance. 3-4 other people were also present at the time of advancing of loan to me, however I do not know the name of these people..."
8. After closing of defence evidence, matter was listed for final arguments. The same were advanced before the Ld. Predecessor and case was listed for judgement however, regular court functioning was suspended on account of the Covid-19 pandemic. The undersigned took charge on 17.11.2020 and arguments were heard afresh and matter was reserved for judgement after hearing rival submissions on both sides.
Legal Position
9. In order to establish the offence under Section 138 of the Act, the prosecution must fulfil all the essential ingredients of the offence, as highlighted hereunder.
First Ingredient: The cheque was drawn by a person on an account maintained by him for payment of money and the same is presented for payment within a period of 3 months from the date on which it is drawn or within the period of its validity; Second Ingredient: The cheque was drawn by the drawer for discharge of any legally enforceable debt or other liability; Third Ingredient: The cheque was returned unpaid by the bank due to either insufficiency of funds in the account to honour the Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:10:58 +05'30' 8 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 cheque or that it exceeds the amount arranged to be paid from that account on an agreement made with that bank; Fourth Ingredient: A demand of the said amount has been made by the payee or holder in due course of the cheque by a notice in writing given to the drawer within thirty days of the receipt of information of the dishonour of the cheque from the bank; Fifth Ingredient: The drawer fails to make payment of the said amount of money within fifteen days from the date of receipt of notice.
10. Further, all the conditions stipulated under Section 142 of the Act must be satisfied. The complainant asserts that he has prima facie satisfied all the aforesaid conditions. However, the accused has disputed the fulfilment of the second and fifth ingredients. The same are being considered hereinafter.
Appreciation of Evidence Whether the Cheques in Question are admitted by the Accused-
Inconsistent Pleas
11. The accused has not put forth a clear sustainable line of defence during the trial. Initially, during the serving of notice under Section 251 CrPC, he admitted the cheques in question however, raised a doubt over the quantum of loan taken and claimed to have repaid it.
"1. It is correct that the cheque in question bears my signature, name of my bank and my account number. However, I did not fill the body of the cheque in question."
Later, during the cross-examination of the complainant, the accused did not question the admissibility of cheques however, alleged that the complainant was engaged in the business of money lending and that money lent had been Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:11:10 +05'30' 9 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 repaid by the accused and blank signed cheques were given by accused as security prior to said repayment.
"..It is wrong to suggest that accused had given blank signed cheque to me as security before taking loan of Rs 50,000/- and I had subsequently filled the body of the cheque in question."
12. Thus, it is clear that accused admitted the cheques in question and did not raise any doubt qua his signatures on the cheques until the recording of Statement of Accused under section 313 CrPC, wherein the accused entirely abandoned the erstwhile plea and claimed that the cheques in question did not bear his signature. Interestingly, he signed his statement in Hindi.
"1. It is correct that the cheque in question belongs to me but it does not bear my signature. I did not fill the body of cheques in question"
13. Additionally, during defence evidence as well, the accused wittingly signed his statement in Hindi. Herein, he adopted a completely new and inconsistent defence that his son entered into certain transactions with Tirupati Group (allegedly run by the complainant) and that he issued the cheques for security as guarantor.
"..Therefore, I also engaged in the transaction and I issued a cheque for security being guarantor.."
14. Firstly, it is clear as day that the latter defence taken by the accused is an afterthought and entirely inconsistent with his initial plea of defence. Even during the cross-examination of the complainant, the accused has admitted that he issued signed blank cheques to the complainant albeit as security. His newfound improved plea that cheques in question did not bear his signature is nothing but a self-defeating argument because by his own admission, during the defence evidence, the accused Digitally signed by AISHWARYA AISHWARYA SINGH KASHYAP 10 of 18 SINGH KASHYAP Date: 2021.11.09 11:11:24 +05'30' Mohit Gupta vs Mohinder Singh CC No 2465/2017 deposed that he issued the cheques for security as guarantor thereby admitting both the cheques in question. Secondly, a close perusal of the record establishes that signatures on the cheques in question belong to the accused as reflected in the notice dated 15.10.2018 as well as cash receipt Ex. CW1/A. The accused has deliberately signed the latter judicial record/evidence in Hindi without ever having raised a plea that he is unable to read/write/sign in English. Therefore, both the cheques in question are deemed to be admitted by the accused qua his signatures.
Not Filling the Particulars of the Cheques
15. Another (inconsistent) defence of the accused is that the signed blank cheques in question were given for the purpose of security and that he had only taken a loan of Rs. 50,000/- which he had duly repaid. It is no longer res integra that once the signature on the cheque is admitted by the accused, presumptions under Section 118 read with Section 139 of the Act arise in favour of the complainant. The Hon'ble Supreme Court in Bir Singh vs Mukesh Kumar (2019) 4 SCC 197 held that it is immaterial that another person filled the cheque if the cheque is duly signed by the drawer and particulars of cheque being filled by someone else do not invalidate the cheque. Recently, the Full Bench of the Hon'ble Apex Court in Triyambak S Hegde vs Sripad 2021 SCC OnLine SC 788 held that once the signature on the cheque is admitted or is not in dispute, the presumptions in favour of the complainant are raised and remain in force until rebutted.1 AISHWARYA Digitally signed by AISHWARYA SINGH SINGH KASHYAP Date: 2021.11.09 11:11:39 1 Para 17. KASHYAP +05'30' 11 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 Security Cheque/Guarantor
16. The accused, during the serving of notice and recording of complainant's evidence has claimed that the cheques in question were given as 'security' to the complainant against a loan amount of Rs 50,000/- only. However, during recording of defence evidence, he stated that he did not know the complainant and the cheques in question were given as security for the short term loan taken by his son wherein accused stood as guarantor.
"I did not knew (sic) the complainant but I knew Praveen Kumar, brother-in-law (jija) of the complainant. The brother-in-law of the complainant was working in a chit fund named Sachdeva Finances. He used to come for collection of daily wages from my son Rahul Sabbarwal. Praveen Kumar told that he alongwith the complainant was to start financing business in the name of Tirupati Group..Some transactions were going on between my son and the Tirupati Group. Therefore, I also engaged in the transaction and I issued a cheque for security being guarantor. I do not have any liability towards the complainant."
17. There are a retinue of precedents on the issue of 'security cheques' rendered by the Hon'ble Supreme Court wherein no kernel of doubt remains that the bare defence of 'security cheque' cannot be raised in a cheque dishonour case until it is proved that no liability existed at the time of presentment of cheque either because presentment was premature and liability had not yet arisen or that no liability existed on account of payment/ cancellation of transaction. Most recently, the Hon'ble Division Bench of the Apex Court 2 in the case of Sripati Singh (since deceased) Through His Son AISHWARYA Digitally signed by AISHWARYA SINGH 2 Justice M R Shah and Justice A S Bopanna SINGH KASHYAP Date: 2021.11.09 11:11:52 KASHYAP +05'30' 12 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 Gaurav Singh vs the State of Jharkhand & Anr, 2021 SCC OnLine SC 1002 held as under:
A cheque issued as security pursuant to a financial transaction cannot be considered as a worthless piece of paper under every circumstance. 'Security' in its true sense is the state of being safe and the security given for a loan is something given as a pledge of payment. It is given, deposited or pledged to make certain the fulfilment of an obligation to which the parties to the transaction are bound. If in a transaction, a loan is advanced and the borrower agrees to repay the amount in a specified timeframe and issues a cheque as security to secure repayment; if the loan amount is not repaid in any other form before the due date or if there is no other understanding or agreement between the parties to defer the payment of amount, the cheque which is issued as security would mature for presentation and the drawee of the cheque would be entitled to present the same. On such presentation, if the same is dishonoured, the consequences under Section 138 and the other provisions of NI Act would flow."3 Thus, it is unequivocally crystal clear that there is no magic in the word 'security' nor the Act carves any exception for security cheques as discussed in great detail by the Hon'ble High Court of Delhi in Suresh Chandra Goyal v Amit Singhal 2015 SCC OnLine Del 9459. The accused cannot simply claim the defence of the cheques in question being issued as 'security cheques' without proving that liability did not exist/prove repayment of loan amount prior to the presentation of the cheque.
18. Similarly, the defence of the accused that he issued the cheques in question as guarantor also fails since liability arises when the payment becomes due and the same is legally recoverable against the guarantor as held by the Hon'ble Supreme Court in ICDS Ltd v Beena Shabeer.4 AISHWARYA Digitally signed by AISHWARYA SINGH 3 Para 16.
SINGH KASHYAP
Date: 2021.11.09
4 (2002) 6 SCC 426. KASHYAP 11:12:16 +05'30'
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Standard of Proof
19. The scales of degree of proof required, in a cheque dishonour case, have been set by the Hon'ble Supreme Court in Rangappa vs Sri Mohan (2010) 11 SCC 441 holding that once the cheque and signatures are admitted, presumptions in favour of the complainant are raised. However, said presumptions are rebuttable in nature and the 'standard of proof' required on part of the accused is that of 'preponderance of probabilities'. This can be achieved either by adducing evidence in defence or by raising probable defence whilst relying on the evidence already on record.
13. In the present case, the accused made several inconsistent statements throughout the trial with respect to material particulars and failed to elicit any discrepancy in the evidence of the complainant to cast any iota of doubt over the existence of loan transaction. The accused has led defence evidence however, neither his testimony nor the testimony of DW2 are reliable or inspire confidence in the court.
Non-Existence of Legally Enforceable Liability
14. The accused has made inconsistent statements with respect to having taken the loan, the quantum of loan as well as his signatures on the cheques in question throughout the trial. He abandoned his initial plea that he took a loan of Rs 50,000/- from the complainant (instead of 1.50 lacs) in favour of an improved plea that his son took a short term loan from the brother-in-law of the complainant, who is alleged to have been running 'Tirupati Group' with the complainant. However, the accused has failed to bring either of the aforesaid two key/material witnesses on record AISHWARYA Digitally signed by AISHWARYA SINGH SINGH KASHYAP 14 of 18 Date: 2021.11.09 11:12:31 KASHYAP +05'30' Mohit Gupta vs Mohinder Singh CC No 2465/2017 i.e. the son of the accused and the brother-in-law of the complainant. Instead, the accused favoured the testimony of one Ms Aakansha as DW2, without ever mentioning her name as an eye-witness to the instant loan transaction or himself being a guarantor to the alleged loan taken by her from the complainant. DW2 has miserably failed to prove the defence of the accused whilst making the following inconsistent pleas , shrouding her entire testimony in grave doubt and rendering it completely unreliable.
i). Claiming that the complainant was running a finance business in the name of Tirupati Group however, failing to mention the address of the shop (despite running her shop next to it) or brining the document she claimed could prove that the complainant was running such a business.
"I know the complainant as I am running my shop in the name of Divya Fashion Center near the shop of complainant. Complainant is running business of finance in the name of Tirupati Finance f rom the said shop along with Praveen. In the year 2016, I had taken loan of Rs 50,000/- from the complainant at 10% per month...The complainant had took my signature on one blank paper and a blank signed cheque from me in which accused was guarantor. I can produce the Card issued by the complainant...Complainant used to lend the loan to other persons also in similarly (sic) manner."
On 23.01.2020 "Today, I have not produced any document. I do not know the address of Tirupati Fiance. I do not know who is the owner of Tirupati Finance. I do not have any documentary proof to show that I had taken Rs 50,000/- in cash from the complainant.
ii). In-fact her testimony, as highlighted hereunder, is in the teeth of the both the claims of the accused: first, that he took a loan of only Rs 50,000/- from the complainant which he allegedly repaid against written acknowledgement (not produced on record) and second, that his son took a short term loan from the brother-in- law of the complainant allegedly running one Tirupati Group:
AISHWARYA Digitally signed by AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:12:44 +05'30'
15 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 "...Accused had taken Rs 1,50,000/- from the complainant and he had returned the same in my presence. I do not remember the exact date and month on which the payment was made and returned. The amount was given at the office of Tirupati Finance.
15. Therefore, the accused has failed to raise any ounce of probable defence in his favour against the testimony of the complainant. The accused has not filed any criminal or police complaint either against alleged misuse of security cheques or even the cash receipt Ex CW1/A where signature of the accused is not disputed. Further, in the absence of the testimony of the son of the accused or the executor of the documents, neither Ex. DW1/A nor Mark X can be said to have been proved thus no evidentiary value can be attributed to either of these documents. No evidence has been forthcoming that connects said Tirupati Group to the complainant or the instant transaction. Even so, the existence of liability qua loan has not been disproved. The accused has not furnished any proof of repayment. During serving of notice, he claimed to have taken a loan of only Rs 50,000/- which was repaid against written acknowledgement. However, no such written acknowledgement has ever been produced by the accused till date. Interestingly, the supposed eye- witness DW2 has claimed that the accused took a loan of Rs 1.50 lakhs from the complainant thereby obliquely supporting the case of the complainant.
16. 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. It is not necessary for the accused to come in the witness box in AISHWARYA Digitally signed by AISHWARYA SINGH SINGH KASHYAP Date: 2021.11.09 11:12:58 KASHYAP +05'30' 16 of 18 Mohit Gupta vs Mohinder Singh CC No 2465/2017 support of his defence.5 This has further been elaborated in Rangappa (supra) holding that:
"Under Secion 118(a) of the NI Act, the court is obliged to presume, until the contrary is proved, that the promissory note was made for consideration. It is also a settled position that the initial burden in this regard lies on the defendant to prove the non-existence of consideration by bringing on record such facts and circumstances which would lead the court to believe the non-existence of the consideration either by direct evidence or by preponderance of probabilities showing that the existence of consideration was improbable, doubtful or illegal."6
17. However, in the instant case, despite leading defence evidence, the accused has failed to prove the non-existence of such consideration or even rending its existence improbable. In- fact, the accused himself has not been able to put forth a probable defence wherein his own testimony as well as that of DW2 on which he seeks to rely, are riddled with grave inconsistencies. On the other hand, the evidence led by the complainant has remained unimpeached in toto; the presumptions in favour of the complainant under Section 118 read with Section 139 of the Act have not been rebutted. Therefore, the accused has failed to raise a probable defence.
Non-Receipt of Legal Demand Notice
18. The fifth ingredient is contested by the accused as he has claimed that he did not receive the legal demand notice. However, the Hon'ble Supreme Court in C.C.Alavi Haji vs Palapetty Muhammed (2007) 6 SCC 555 has laid bare the settled position herein, holding that presumptions under Section 27 of the General Clauses Act, 1897 and Section 114 of the Evidence Act, 1872 are invoked when receipt of legal demand notice is in AISHWARYA Digitally signed by AISHWARYA SINGH 5 Basalingappa vs Mudibasappa (2019) 5 SCC 418. 6 Para 23.
SINGH KASHYAP
Date: 2021.11.09 11:13:13
KASHYAP +05'30'
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question. The accused must either rebut said presumption or pay within 15 days of receipt of court summons. Furthermore, admittedly, the accused has not challenged the accuracy of the addresses on record and court summons and warrants have been executed at the same given address. Therefore, this defence is not available to the accused since he has failed to rebut the presumption of delivery of legal demand notice.
Decision
19. In view of the aforementioned discussion, the accused has failed to raise any probable defence in the instant case and the complainant has successfully proved the commission of offence by the accused under Section 138 of the Act by satisfying all the essential ingredients of the offence. Accordingly, the accused is held guilty for committing the offence punishable under Section 138 of the Act. The accused, Sh. Mohinder Singh is hereby convicted. Let the convict be heard separately on the quantum of sentence.
ORDER: Convicted A copy of this judgement be given free of cost to the convict. Announced in Open Court in the presence of the accused on 09.11.2021.
(This judgement contains 18/eighteen signed pages.) AISHWARYA Digitally signed by AISHWARYA SINGH KASHYAP SINGH KASHYAP Date: 2021.11.09 11:13:31 +05'30' (Aishwarya Singh Kashyap) MM/NI Act(East)/KKD Courts Delhi 09.11.2021 18 of 18