Delhi District Court
) Sh. Rajesh Khurana vs Smt. Munesh Kumari on 24 May, 2019
IN THE COURT OF SH. AJAY GUPTA, ADDL.SESSIONS
JUDGE02 (EAST) KARKARDOOMA COURTS, DELHI
Criminal Appeal No. 46/2019
1) Sh. Rajesh Khurana
S/o Sh. Kishan Lal Khurana
2) Smt. Sonia Khurana,
W/o Sh. Rajesh Khurana
Both R/o F425, Pocket2,
Mayur Vihar, PhaseI,
Delhi110091
....Appellants
versus
Smt. Munesh Kumari
S/o Sh. Radhey Shyam,
R/o 62, Patparganj,
Opposite UNA Apartment,
Delhi110091
....Respondent
Date of institution 25.02.2019
Arguments heard 27.04.2019
Date of order 24.05.2019
JUDGMENT
1. The present appeal has been filed by the appellants against the judgment dated 24.01.2019 and order on sentence dated 30.01.2019 passed by Sh. Sujit Saurabh Ld. MM (East), Karkardooma Courts, Delhi, in complaint case bearing CC No.55119/16 titled as Smt. Munesh Kumari vs Rajesh Khurana etc. u/s 138 of Negotiable Instruments Act (hereinafter referred as NI Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 1 of 27 Act). Vide the aforesaid judgment Ld. MM has convicted the appellants u/s 138 NI Act and vide order dt 30.01.2019, the appellants have been sentenced to suffer simple Imprisonment for three months and to pay fine of Rs.1,40,000/ each out of which Rs.1,35,000/ is payable to complainant as compensation and remaining Rs.5000/ is to be deposited with State by each convict and in case of default of payment of fine, convicts are to further undergo simple imprisonment for 20 days.
2. The brief facts of present case are that the respondent/complainant filed a complaint u/s 138 of N.I. Act against the appellant/accused (hereinafter both the parties have been referred as per their nomenclature in the complaint) on the basis of the following allegations:
(a) that the accused persons and the complainant were having family relation. On 20.08.2013, the accused persons had taken friendly loan of Rs.2 lacs from the complainant in presence of her husband giving assurance to return the same within one year.
(b) In discharge of their aforesaid liability, the accused persons issued a cheque bearing No.029485 dated 23.06.2015 of Rs.2 lacs from their joint account held in IDBI Bank, Acharya Niketan, Mayur Vihar, PhaseI, Delhi.
(c) That the complainant presented the said cheque for encashment, however, aforesaid cheque got dishonoured vide return memo dated 25.06.2015 with the remarks "Funds Insufficient".
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 2 of 27
(d) That the complainant sent legal notice dated 08.07.2015 on 15.07.2015 at address of the accused persons through Speed Post. However, both speed post envelopes received back 'unclaimed' on 03.08.2015. Neither the accused persons sent reply to the notice nor made payment of the dishonoured cheque. Thus, it was prayed that accused persons may be summoned and punished in accordance with law.
3. On 28.11.2015, notice u/s 251 Cr.P.C for commission of the offence u/s 138 N.I. Act was served upon both accused to which they pleaded not guilty. Both accused denied the allegations and took common defence. The defence taken by accused Rajesh Khurana reads as under: Q. Did the cheque in question bear your signature? A. Yes. The cheque bears my signature and pertains to joint account with my wife Sonia Khurana.
Q. Did you issue the said cheque to the complainant. A. Yes. I issued the cheque to the complainant.
Q. Did you receive the legal notice?
A. No. I did not receive the legal notice from the complainant. Q. Do you plead guilty or have any defence to be made? A. No. I do not plead guilty and claim trial. The cheque in question was given in blank signed condition to the complainant for security of a committee of Rs.1,50,000/, which was being run by the complainant, of which I was a member along with my wife Sonia Khurana. I was paying monthly installments of Rs.10,000/ in cash to the complainant as part of the committee, but due to Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 3 of 27 loss in business I could not pay last 34 installments to the complainant and the complainant has thereafter misused the cheque in question by filling in more amount than due. I am not liable for the cheque amount. I and my wife are ready and willing to pay the remaining installments amount i.e. Rs.40,000/ to the complainant. I have also paid interest about Rs.30,000/ to Rs.40,000/ on the committee amount of Rs.1,50,000/.
4. In support of her case, complainant examined herself as CW1 and her husband Sh. Radhey Shyam as CW2.
5. Complainant/CW1 brought on record following documents:
a) Original cheque no.029485 Ex.CW1/1.
b) Cheque returning memo Ex.CW1/2.
c) Legal notice Ex.CW1/3.
d) Postal receipts Ex.CW1/4 and Ex.CW1/5.
e) Unclaimed Speed Post envelopes Ex.CW1/6 and Ex.CW1/7.
f) Copy of tracking reports Ex.CW1/8 and Ex.CW1/9.
6. CW2 supported the version of the complainant in his evidence.
7. After completion of complainant's evidence, the statement of both accused persons were recorded separately under section 313 Cr.P.C. Both accused denied the material allegations and stated that the subject cheque was given in blank signed condition as security for a committee to the complainant under force. They did not receive the legal demand notice. They have no liability for the cheque amount towards the complainant and both accused opted to lead defence evidence.
8. In their defence, both the accused examined themselves as DW1 and DW2.
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 4 of 27
9. DW1/accused Smt. Sonia Khurana deposed that in April 2014, she along with her husband had subscribed the membership of a committee of Rs.1,50,000/ The subscription of the committee was Rs.10,000/ per month and it comprised of 15 members. In the month of December 2014, they had taken the committee amount of Rs.1,50,000/. The complainant had demanded a cheque against the committee amount of Rs.1,50,000/. She had given blank signed cheque under her signature as well as signature of her husband as security to the complainant. They could not pay last 34 subscription of the committee. They did not receive any communication from the court till police came for execution of bailable warrant. They have not taken any loan from the complainant and the complainant has filed false case against them.
10.DW2/accused Rajesh Khurana deposed that in April 2014, he and his wife had subscribed membership of the committee of Rs.1,50,000/ run by the complainant. The duration of committee was of 15 months. DW2 further deposed that as per slip system, the committee was drawn in their favour in the month of December 2014. At that time, the complainant asked them for security cheque in blank signed condition. Complainant had demanded separate cheques from him and his wife. He had initially denied to give blank cheque to the complainant. The complainant told him that she would normally take a blank signed cheque from a person not known to her. DW2 further deposed that they could not pay 34 subscription of Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 5 of 27 committee. The committee was supposed to end in the month June 2015 and when he failed to pay the subscription of the committee, the complainant started intimidating them.
11.On completion of the trial, Ld. Trial Court convicted both the accused thereby holding that accused failed to prove their defence and rebut the presumption of Section 139 of NI Act.
12.Now the present appeal has been filed by the appellants/accused persons mainly on the following grounds:
(a)That the impugned judgment and order on sentence are based on conjectures and surmises.
(b) That the Ld. Trial Court has not appreciated the facts that the appellants had not received the legal demand notice which is mandatory requirement for initiating the trial under section 138 of N.I. Act and this fact has been proved by the respondent herself by relying on document Ex.CW1/6 and CW1/7.
(c) That the Ld. Trial Court has not considered the judgments i.e. V. Raja Kumari vs P. Subbarama Naidu & Anr., and Rita Kumar vs State of Jharkhand & Anr., which were filed along with written arguments.
(d) That the respondent failed to bring on record the concrete and convincing evidence regarding loan transaction or creating financial liability. The respondent has failed to prove that the appellants were in debt to her or there was any liability towards Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 6 of 27 respondent to be discharged by the appellants. In support of contention reliance is placed on the judgment reported as Shajahan T. M. vs. P.J. Abrahim, Puthenpurayil House and Anr., Crl. Appeal No.1914, 1917, 1918 and 1919 of 2006 by Hon'ble Kerala High Court.
(e)That the cheque was not issued for consideration and in discharge of any debt or liability. Presumptions both u/s 118 and 119 are rebuttable in nature and they had duly rebutted the presumption by leading defence evidence and in this regard reliance is placed on the judgment reported as Hiten P. Dalal V. Bratindranath Banerjee {(2001) 6 SCC 16}.
(f) That the Ld. Trial Court has not considered the defence brought by them and number of contradictions in the case setup by the appellants. Ld. Trial Court also failed to appreciate that both defence witnesses were not crossexamined by the respondents on the strength of her own case.
13.I have heard the submissions of Ld. counsel for the appellants and also Ld. counsel for the respondent/complainant. I have also gone through the record of the case as well as case laws cited by the Ld. Counsel for appellant.
14.It is held by Hon'ble Supreme Court in the case of 2000 (2) SCC 745 titled as M/s Kusum Ingots & Alloys Ltd. Vs M/s Pennar Peterson Securities Ltd that to constitute an offence u/s 138 of Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 7 of 27 Negotiable Instruments Act the following requirements are to fulfilled:
(a) 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;
(b) 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;
(c) 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;
(d) 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 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;
(e)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.
15.In view of the law laid down by the Hon'ble Supreme Court in the aforesaid case, it is to be seen, if the aforesaid requirements have been fulfilled in the present case. The complainant has claimed that she had given a loan of Rs.2 lacs to the accused persons and qua repayment, accused persons had issued the subject cheque while the accused persons have disputed the claim of the complainant and have mainly taken a defence that the subject was issued to the complainant towards security of the committee (chitfund) of Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 8 of 27 Rs.1,50,000/ and same has been misused by the complainant. This defence of the accused persons is discussed in the later part of the order, however, it is clear from the record that it is undisputed that the complainant had presented the cheque for encashment and it got dishonoured vide return memo Ex.CW1/2 due to insufficient funds in the bank account of the accused persons.
16.The accused persons have disputed the service of the legal notice and stated that the legal notice was not served upon them. Ld. Counsel for appellants/accused persons submitted that the complainant had not issued the legal notice at their correct address and at the relevant time, the accused persons were not residing at the address where the legal notice was sent by the complainant and they had already shifted from there. In this regard, the appellants have relied upon the returned speed post envelopes i.e. Ex.CW1/6 and Ex.CW1/7. The contention raised by the appellants does not find support from the returned speed post envelopes as well as the speed post article tracking report taken from the internet that the postman concerned has reported that the intimation regarding the letter was given at the end of the addressee yet the speed post was not collected from the side of accused persons and therefore, after making three attempts for delivery on dated 06.07.2015, 17.07.2015 and on 01.08.2015 and the speed post was returned back to the addressor/Ld. Counsel for complainant, as despite due intimation, none came forward from the side of the accused persons to take the Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 9 of 27 delivery of the speed post and it was returned back as unclaimed. Thus, it is clear from these circumstances that the speed post was not returned with the report that the accused persons had shifted from the given address and it was returned for the reason that it was not collected by the accused persons despite due intimation. It has been held by the Hon'ble Supreme Court in the case of C.C. Alavi Hazi vs. Palapetti Muhammed and Anr 2007 (6) SCC 555 that the legal notice will be presumed to have been served if the same was sent at the correct address and received back unserved though the addressee had the knowledge of the notice. Relevant paras of the judgment reads as under:
13. According to Section 114 of the Act, read with illustration (f) thereunder, when it appears to the Court that the common course of business renders it probable that a thing would happen, the Court may draw presumption that the thing would have happened, unless there are circumstances in a particular case to show that the common course of business was not followed. Thus, Section 114 enables the Court to presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business in their relation to the facts of the particular case. Consequently, the court can presume that the common course of business has been followed in particular cases. When applied to communications sent by post, Section 114 enables the Court to presume that in the common course of natural events, the communication would have been delivered at the address of the addressee. But the presumption that is raised under Section 27 of the G.C. Act is a far stronger presumption. Further, while Section 114 of Evidence Act refers to a general presumption, Section 27 refers to a specific presumption. For the sake of ready reference, Section 27 of G.C. Act is extracted below :
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 10 of 27 "27. Meaning of service by post. Where any Central Act or Regulation made after the commencement of this Act authorizes or requires any document to be served by post, whether the expression "serve" or either of the expressions"
"give" or "send" or any other expression is used, then, unless a different intention appears, the service shall be deemed to be effected by properly addressing, prepaying and posting by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in the ordinary course of post".
14. Section 27 gives rise to a presumption that service of notice has been effected when it is sent to the correct address by registered post. In view of the said presumption, when stating that a notice has been sent by registered post to the address of the drawer, it is unnecessary to further aver in the complaint that in spite of the return of the notice unserved, it is deemed to have been served or that the addressee is deemed to have knowledge of the notice. Unless and until the contrary is proved by the addressee, service of notice is deemed to have been effected at the time at which the letter would have been delivered in the ordinary course of business. This Court has already held that when a notice is sent by registered post and is returned with a postal endorsement "refused" or "not available in the house" or "house locked" or "shop closed" or "addressee not in station", due service has to be presumed. [Vide Jagdish Singh v. Natthu Singh, AIR 1992 Supreme Court 1604; State of M.P. v. Hiralal & Ors., (1996)7 SCC 523 and V. Raja Kumari v. P.Subbarama Naidu & Anr. 2004(4) RCR(Criminal) 933 : 2005(1) Apex Criminal 58 : (2004)8 SCC 774]. It is, therefore, manifest that in view of the presumption available under Section 27 of the Act, it is not necessary to aver in the complaint under Section 138 of the Act that service of notice was evaded by the accused or that the accused had a role to play in the return of the notice unserved.
17.Thus, it is clear from the settled law that where the notice has been sent at the correct address and even when addressee is not found Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 11 of 27 available and the notice returned back with the report that addressee is not available then under these circumstances, the notice is presumed to be served. In the instant case, it is clear from the aforesaid discussions that the notice was issued at the correct address else the postman would have reported that the addressee has shifted instead of returning the same with the remarks of unclaimed. Thus, under these circumstances, in view of the settled law and presumption u/s 27 of General Clauses Act, the notice is presumed to be served. Furthermore, the notice was sent after dishonour of the cheque and accused persons would be well aware about the factum of dishonour of cheque, thus, under these circumstances and especially, keeping in view of the report of the postman, it seems that the accused persons knowingly evaded service of the notice despite due intimation of the same was given at their end.
18.Furthermore, the complainant was only under an obligation to send the legal notice to the accused persons at the address known to her. During the course of the arguments, Ld. Counsel for appellants has submitted that at the relevant time, the accused persons were not residing at the given address. Thus, according to the stand of appellants, at the relevant time, they were not residing where the legal notice was sent by the complainant, however, nothing has been placed on record by the appellant to show as to until when the appellants resided at their previous address and they have also not Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 12 of 27 brought on record any evidence to show that they had informed the complainant about their fresh address. Thus, in case, the accused persons had changed their address and they had not intimated the complainant about their fresh address, the complainant could not have sent the legal notice at their latest address. It is clear from the perusal of the crossexamination of the complainant as well as the testimony of both the appellants/accused (DW1 and DW2) that no question has been put to the complainant during crossexamination that she had sent the legal notice at the previous address of the accused despite knowing the fact that they had already shifted from there. The accused persons have also not stated in their evidence that they had informed the complainant about change of their address. Thus, firstly, it is clear from the record that the stand of the accused persons that at the time of service of legal notice they were not residing at their previous address, does not find support from the returned speed post and secondly, they had not brought on record any evidence to show that they had intimated the complainant about their change of address. Thus, under these circumstances, the complainant was fully justified in sending the legal notice at the address of accused persons known to her. Thus, in view of the settled law, the legal notice is presumed to have been served upon the accused persons.
19.It is further clear from the record that accused persons did not pay the cheque amount neither within 15 days of the service of the legal Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 13 of 27 notice nor thereafter. Thus, it is clear from the record that all necessary requirements to constitute the offence u/s 138 N.I. Act, have been fulfilled except that whether on the date of presentation of cheque by the complainant, the cheque was against due debt or was without consideration as claimed by the accused persons. This point will be discussed in the later part of the order and before making further discussions on the factual aspects of the case, it is deemed necessary to firstly discuss the relevant provisions of N.I Act and the legal position which is required to be taken into consideration for appropriate disposal of the case U/s 138 of N.I Act.
20.The claim based under the provisions of Negotiable Instruments Act is an exception to the general rule of law that burden of proof lies on the prosecution. There are two specific provisions in negotiable instruments acts i.e. section 118 (a) and 139 of NI Act which contemplates that a presumption is attached in regard to each and every negotiable instrument that the same was drawn and issued against due discharge of the liability and thus, whenever any claim is made on the basis of a negotiable instrument, the presumption has to be drawn in favour of the holder of the cheque (drawee) and the law has put the burden to rebut the presumption on the accused that the cheque was not issued by him against discharge of a debt or a liability. In case, the accused is not able to rebut the presumption and fails to prove his defence, the presumption becomes absolute and it has to be assumed that the cheque was issued by the Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 14 of 27 accused in discharge of debt or liability and consequently, accused has to be assumed guilty of the offence. The relevant provisions of section 118 (a) and section 139 of NI Act reads as under: Sec 118 Presumptions to negotiable instruments.Until the contrary is proved, the following presumption 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, endorsed, negotiated or transferred, was accepted, endorsed, negotiated, or transferred for consideration.
139. Punishment in favour of holder: It shall be presumed, unless the contrary is provided, 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.
21.It has been held by Hon'ble Supreme Court in the case reported as 2001 (6) SCC 16 titled as Hiten P. Dalal v. Bratindranath Banerjee that the presumption mentioned in the section 139 of NI Act, is a presumption of law and not the presumption of fact and thus, this presumption has to be drawn in favour of the drawee and burden to rebut the presumption with the probable defence is on the accused. The relevant para of the aforesaid case law reads as under:
21. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the Court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 15 of 27 considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that it exists"
[Section 3 : Evidence Act]. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man.
22.It has been held by the Hon'ble Supreme Court in the case of reported as 2010 (11) SCC 441 titled as Rangappa v. Mohan that presumption of section 139 of N.I. Act also includes the existence of legal enforceable debt. The relevant para of the said judgment reads as under:
14. In light of these extracts, we are in agreement with the respondent claimant that the presumption mandated by Section 139 of the Act does indeed include the existence of a legally enforceable debt or liability.
23.In Bharat Barrel v. Drum Manufacturing AIR 1999 SC 1008, the Hon'ble Supreme Court held that the accused has to rebut the presumption and mere denial of passing of consideration is no defence.
24.Thus, in view of the law laid down by the Hon'ble Supreme Court in the aforesaid cases, the presumption as contemplated under section 139 N.I. Act has to be drawn in favour of the drawee that the cheque in question was issued in discharge of legally enforceable liability.
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 16 of 27 Thus, in the present case also complainant was not required to prove that the cheque in question was issued by the accused towards the repayment of the loan amount taken by them and initially, the claim of the complainant was to be assumed to be correct by drawing the presumption of section 139 of N.I. Act and burden to rebut the presumption with their probable defence was on the accused persons.
25.The accused persons have mainly taken a defence that they had not taken friendly loan from the complainant and they were one of the members of a committee which was being run by the complainant. The total amount of the committee was Rs.1.5 lacs and it comprised of 15 members and they had given the subject cheque to the complainant towards security of the committee. It is also contended that they could not give 34 subscription amount of the committee to the complainant due to loss in business and the subject cheque which was meant for security, has been misused by the complainant. However, after considering the record and the evidence, it is clear that the defence of the accused persons is apparently not trustworthy for the reasons discussed hereinafter.
26.The accused persons have mainly contended that they had not taken the friendly loan of Rs.2 lacs from the complainant and the subject cheque was given by them to the complainant towards security of a committee (chitfund) of 15 months. They have also contended that they had taken the prize money of the chitfund and Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 17 of 27 they were to pay Rs.10,000/ towards monthly subscription amount, however, due to loss in business they could not pay last 34 installments. Thus, according to the defence of the accused persons, the subject cheque came into possession of the complainant as contended by them. Thus, in view of the settled law, the onus was on the accused persons to establish on record the aforesaid defence taken by them. It is clear from the record that accused persons have simply taken the aforesaid defence, however, they have not brought on record any evidence to establish their defence. The accused persons have simply stated that they were members of committee which was organized and run by the complainant, however, they have not brought on record any evidence to establish the same. As per accused persons there were 15 members of the committee, however, accused persons have neither specified names of other members/subscribers of the committee nor examined anyone of them to support their claim. Thus, accused persons have not brought on record any material to support their version and therefore, the simple denial of liability without establishing the defence taken by the accused will not suffice.
27.The complainant was crossexamined by the Ld. Defence Counsel qua the defence of accused persons, however, she as well as her husband stood firm on their stand that the subject cheque was issued by the accused persons towards repayment of the loan Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 18 of 27 amount. Nothing material has come out of their crossexamination to support the claim of the accused persons. It is also clear that substantial crossexamination was preferred on the aspect of financial capability of complainant in order to establish that she was not financially capable to part with the said amount. However, it is clear that she has categorically stated during her crossexamination that she had been running a business of readymade garments for the last 10 years and she had also brought on record her bank account statement as Mark CW1/DX1. Perusal of this statement shows that the complainant was running a business and was having sufficient amount in her account which shows that she was capable of giving loan amount of Rs.2 lacs to accused persons.
28.It seems from the service report of the legal notice that an intimation about the speed post sent by the Ld. Counsel for complainant was given at the end of the accused persons but they did not come forward to collect the same and this conduct of accused persons shows that they were well aware about the dishonour of the cheque and about the reasons of issuance of legal notice, therefore, they knowingly evaded the service of legal notice and under these circumstances, in view of the law laid down by the Hon'ble Supreme Court in the case of C.C. Alavi Hazi (supra), it is to be presumed that the legal notice was duly served upon them.
29.According to the accused, the complainant had raised a false claim in her legal notice and she had misused the cheque which was Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 19 of 27 given to her as security. As per accused persons, the cheque used by the complainant was without consideration yet the accused did not take any action for the alleged misdeed of the complainant till date nor they sought return of the said cheque. It has been held by Hon'ble Delhi High Court in the case reported as 172 (2010) DLT 561 V.S. Yadav Vs. Reena that it is for the accused to rebut the presumption of section 139 of N.I. Act and also that under what circumstances he had issued the cheque to the complainant as issuing a cheque is a serious business. It is also held that if the cheque was not issued in discharge of the debt then accused is supposed to take appropriate action seeking return of his cheque. In case, the accused failed to establish the reason for issuance of cheque and also why he did not seek return of the cheque then it is to be assumed that he failed to rebut the presumption. The relevant portion of the para no.7 of the said case reads as under: '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 u/s 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.
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 20 of 27 In the instant case also, the accused persons have failed to take any action seeking return of the cheque neither prior to service of legal notice nor after service. Thus, the plea taken by the accused persons that the subject cheque is without consideration is not reliable.
30.Furthermore, the present case is a fit case where adverse inference should be drawn against the accused persons. It is clear from the aforesaid discussions that accused persons intentionally evaded the service of legal notice and did not reply to the said notice. It is clear from the legal notice that complainant claimed that the accused persons issued the subject cheque towards repayment of loan taken by them and the same got dishonoured. Thus, it is clear that after dishonour of cheque, the accused must have come to know that the complainant would use the subject cheque in the legal proceedings to demand the said amount. However, accused persons kept mum and did not take any action whatsoever against the complainant for making a false claim. If the cheque was issued by the accused persons as stated by them and complainant was not a holder in due course and if the same was without consideration and they did not owe any amount and complainant had issued a false notice, the accused persons must have taken appropriate action against the complainant for her alleged misdeeds but they kept silent. In the case reported as 2014(8) AD (Delhi) 26 and titled as 'Santosh Mittal Vs. Sudha Dayal, the Hon'ble High Court has held that the Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 21 of 27 adverse inference can be drawn against the accused where accused has failed to controvert the allegation by sending a reply to the legal notice. The relevant para of the said case reads as under: '21. Admittedly, no reply to the legal notice was sent by her thereby rebutting the allegations made by the complainant. As far back in the year 1980, in Kaluram v. Sita Ram, 1980 RCR Note 44, it was held by this Court that when serious allegations are made in a notice and defendant failed to send any reply, then the allegations are deemed to have been admitted. Even in Rangappa (supra) relied upon by the learned counsel for the appellant it was observed that failure on the part of the accused to reply to the statutory notice under section 138 of the Act lead to inference that there was merit in complainant's version.'
31.In the present case also, the accused persons did not take any action seeking return of their cheque. The accused persons also did not reply to the legal notice. If the complainant had raised a false claim, the accused persons would have rebutted the same by sending a reply. Consequently, the presumption of section 139 of N.I. Act remained unrebutted and accordingly it is to be presumed that accused persons had issued the cheque qua repayment of loan. In view of these discussions, it is held that accused persons have failed to establish their defence.
32.Ld. Counsel for appellant/accused also submitted that the complainant has not proved on record beyond reasonable doubt that she was financially capable of giving loan of Rs.2 lacs to the accused. However, it is already held above that the complainant, being business woman, was very well capable to give such loan Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 22 of 27 amount to the accused persons from her saving. Further, in the case u/s 138 NI Act, there is a reverse onus which lies on the accused and before complainant is asked to establish her source of payment, the accused have to establish their probable defence which they have failed to establish in the instant case and in view of the settled law discussed above, under these circumstances, it is to be assumed that complainant possessed the cheque of the accused persons as contended by her in her legal notice as well as in the present complaint and also in their evidence. In view of these discussions, it is held that accused persons have failed to establish their defence. It is most respectfully observed that the case law cited by the Ld. Counsel for appellant/accused are not applicable to the peculiar facts and circumstances of the present case.
33.Furthermore, it is well settled law that the presumption u/s 139 NI Act cannot be rebutted by simply making statement and accused has to bring on record the evidence to prove the defence taken by him. In this regard, this court is supported with the case law reported as "Hiten P. Dalal v. Bratindranath Banerjee, (SC) : 2001(5) BCR 820". The relevant para of the judgment reads as under:
21. In other words, provided the facts required to form the basis of a presumption of law exist, no discretion is left with the Court but to draw the statutory conclusion, but this does not preclude the person against whom the presumption is drawn from rebutting it and proving the contrary. A fact is said to be proved when, "after considering the matters before it, the Court either believes it to exist, or considers its existence so probable that a prudent man ought, under the circumstances of the particular Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 23 of 27 case, to act upon the supposition that it exists" [Section 3 :
Evidence Act]. Therefore, the rebuttal does not have to be conclusively established but such evidence must be adduced before the Court in support of the defence that the Court must either believe the defence to exist or consider its existence to be reasonably probable, the standard of reasonability being that of the 'prudent man'.
22. Judicial statements have differed as to the quantum of rebutting evidence required. In Kundan Lal Rallaram v. Custodian, Evacuee Property, Bombay, AIR 1961 Supreme Court 1316, this Court held that the presumption of law under Section 118 of Negotiable Instruments Act could be rebutted, in certain circumstances, by a presumption of fact raised under Section 114 of the Evidence Act. The decision must be limited to the facts of that case. The more authoritative view has been laid down in the subsequent decision of the Constitution Bench in Dhanvantrai Balwantrai Desai v. State of Maharashtra, AIR 1964 Supreme Court 575, where this Court reiterated the principle enunciated in State of Madras v. Vaidyanath Iyer (supra) and clarified that the distinction between the two kinds of presumption lay not only in the mandate to the Court, but also in the nature of the evidence required to rebut the two. In the case of a discretionary presumption the presumption if drawn may be rebutted by an explanation which "might reasonably be true and which is consistent with the innocence" of the accused. On the other hand in the case of a mandatory presumption "the burden resting on the accused person in such a case would not be as light as it is where a presumption is raised under Section 114 of the Evidence Act and cannot be held to be discharged merely by reason of the fact that the explanation offered by the accused is reasonable and probable. It must further be shown that the explanation is a true one. The words 'unless the contrary is proved' which occur in this provision 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 if 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 Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 24 of 27 presumption created by the provision cannot be said to be rebutted........."
[See also V.D. Jhingan v. State of Uttar Pradesh, AIR 1966 Supreme Court 1762; Sailendranath Bose v. The State of Bihar, AIR 1968 Supreme Court 1292 and Ram Krishna Bedu Rane v. State of Maharashtra, 1973(1) SCC 366.]
23. We will therefore have to consider whether in the case before us, the appellant had supported his defence by any proof sufficient to rebut the presumption drawn against him.
34.In "K.N. Beena v. Maniyappan (SC), Criminal Appeal No. 1066 of 2001", it has also been held by the Hon'ble Supreme Court that the burden is on accused to prove his defence by way of cogent defence evidence and if he fails to prove that the cheque was not issued against debt or liability then presumption u/s 139 NI Act would remain unrebutted. Relevant paras reads as under:
6. In our view the impugned Judgment cannot be sustained at all. The Judgment erroneously proceeds on the basis that the burden of proving consideration for a dishonoured cheque is on the complainant. It appears that the learned Judge had lost sight of Sections 118 and 139 of the Negotiable Instruments Act. Under Section 118, unless the contrary was proved, it is to be presumed that the Negotiable Instrument (including a cheque) had been made or drawn for consideration. Under Section 139 the Court has to presume, unless the contrary was proved, that the holder of the cheque received the cheque for discharge, in whole or in part, of a debt or liability. Thus in complaints under Section 138, the Court has to presume that the cheque had been issued for a debt or liability. This presumption is rebuttable. However the burden of proving that a cheque had not been issued for a debt or liability is on the accused. This Court in the case of Hiten P. Dalal v. Bratindranath Banerjee, 2001 (3) RCR (Crl.) 460 SC : 2001(6) SCC 16 has also taken an identical view.
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 25 of 27
7. In this case admittedly the 1st Respondent has led no evidence except some formal evidence. The High Court appears to have proceeded on the basis that the denials/averments in his reply dated 21st May 1993 were sufficient to shift the burden of proof onto the Appellant/Complainant to prove that the cheque was issued for a debt or liability. This is an entirely erroneous approach. The 1st Respondent had to prove in the trial, by leading cogent evidence, that there was no debt or liability. The 1st Respondent not having led any evidence could not be said to have discharged the burden cast on him. The 1st Respondent not having discharged the burden of proving that the cheque was not issued for a debt or liability, the convection as awarded by the Magistrate was correct. The High Court erroneously set aside that conviction.
35.It has been held by the Hon'ble Delhi High Court in the case reported as "Sanjay Arora vs. Monika Singh (Cri. Appeal no.98/2017)" that the onus is on the accused to rebut the presumption either by direct evidence or by bringing on record the required material, however, the simple denial of liability is not sufficient to rebut the presumption.
36.Thus, it is held that the accused persons have failed to rebut the presumption and complainant by way of her evidence has established that accused persons had issued the cheque in question for repayment of the amount taken by the accused persons.
37.Since, the appellants/accused persons have failed to repay the cheque amount despite service of legal notice, thus, they are guilty of commission offence u/s 138 N.I Act. In view the aforesaid Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 26 of 27 discussions, this court does not find any infirmity in the order passed by Ld. MM. and holds that the appellants/accused persons have been rightly convicted u/s 138 N.I Act. Hence, the present appeal is liable to be dismissed and accordingly, the same is dismissed.
Digitally signed AJAY by AJAY GUPTA
Location: Delhi
GUPTA Date: 2019.05.24
(Ajay Gupta)
14:44:23 +0530
ASJ02/KKD/East/Delhi
Announced in open
court on 24.05.2019
Cr. Appl No.46/19 Rajesh Khurana vs Smt. Munesh Kumari 27 of 27