Delhi District Court
& Alloys Ltd. vs . Pennar Peterson Securities Ltd. & ... on 2 June, 2012
IN THE COURT OF SH. GAURAV GUPTA,
METROPOLITAN MAGISTRATE (North East),
KARKARDOOMA COURTS, DELHI.
CC NO.8327/09
Unique case ID No.02402R0349872007
U/S. 138 N.I. Act
PS - Vivek Vihar
In the matter of
M/s HDFC Bank Ltd.
Having ITS OFFICE AT:
9th FLOOR, ANSAL CLASSIQUE TOWER,
PLOT NO-1, J-BLOCK, COMMUNITY CENTRE,
RAJOURI GARDEN, NEW DELHI
AND HAVING ITS BRANCH OFFICE AT:
B-5, ASHOKA NIKETAN,
VIVEK VIHAR, NEW DELHI-110095.
THROUGH ITS AUTHORISED SIGNATORY:-
SHRI ARVIND KUMAR/SHAMBHU KUMAR
JHA/ASHISH GUPTA
--------- Complainant
CC No-8327/09 Page 1 of 14
VERSUS
SANDEEP KUMAR
H NO-227 MAJID MODE NEAR SOUTH EXTN
PART II NEW DELHI 110049
ASLO AT:
SANDEEP KUMAR
OUTLOOK WICKLY NEWS AGENCY AB10
SHOPPING ENCLAVE SAFDERJUNG,
NEW DELHI-110052.
----------- Accused
Date of Institution : 10.05.2007
Date on which judgment was reserved: 05.05.12
Date of judgment : 30.05.12
JUDGMENT
1. Vide this judgment I shall dispose of a complaint filed by the complainant against the accused under section 138 of the Negotiable Instruments Act, 1881, (hereinafter referred to as as the "NI Act") for dishonour of a cheque issued by the accused for a sum of Rs.13,140/-(Rupees Thirteen thousand One Hundred Forty only).
2. The brief facts of the case as averred by the complainant in its complaint are that the complainant is a bank incorporated CC No-8327/09 Page 2 of 14 under the companies act and that the present complaint has been filed by duly constituted attorney of the complainant. It has been averred that the accused availed a loan bearing no-2057606 from the complainant and in partial discharge of his liability to repay the loan, the accused issue a cheque bearing no.755005 dt. 05.02.2007 drawn on Standard Chartered Bank for a sum of Rs.13,140/- in favour of the complainant. It has further been averred that when the said cheque was presented by the complainant through its banker for clearance, the same was returned unpaid by the accused's banker vide return memo dated 20.02.2007 with remarks "Account Closed". Thereafter, a legal notice dated 15.03.2007 was sent to the accused through regd. AD post, however, despite service, the accused failed to make payment against the cheque within the stipulated period. Therefore, the complainant was constrained to file the present complaint.
3. After taking the pre-summoning evidence, the court took cognizance of the offence under section 138 NI Act and directed issuance of process against the accused. In pursuance thereof, the accused made an appearance and was admitted to bail. Thereafter, notice under section 251 Cr.PC was served upon the accused on 18.05.2010 to which he pleaded not guilty and claimed trial.
4. In his evidence, the complainant examined Arvind Sahota, AR of the complainant as CW1 who tendered his CC No-8327/09 Page 3 of 14 affidavit Ex.CW1/1 in evidence. The complainant placed reliance on the following documents:
i) Copy of power of attorney as ExCW1/A (OSR).
ii) The dishonoured cheque as Ex.CW1/B
iii) The cheque return memo as Ex.CW1/C.
iv) Copy of legal notice as Ex. CW1/D.
v) Postal receipt as Ex. CW1/E.
5. Thereafter, statement of accused was recorded under section 313 Cr.PC on 09.12.11, wherein, all the incriminating circumstances were put to the accused. The accused admitted having availed the loan from the complainant. The accused also admitted his signatures on the cheque but denied all other allegations. The accused examined himself as DW1.
6. Before dealing with the rival contentions raised on behalf of the parties, it would be convenient to quote the provisions of section138 NI Act hereunder:
"138. Dishonour of cheque for insufficiency, etc. of funds in the account-
Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part of any debt or other liability is returned by the bank unpaid, either because of the amount of money standing to CC No-8327/09 Page 4 of 14 the credit of that account is insufficient to honour the cheque or agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this act, be punished with imprisonment for a term which may be extended to two years, or with fine which may extend to twice the amount of the cheque, or with both.
Provided that nothing contained in this section shall apply unless-
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, 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 thirty days of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or as the case may be, to the holder in due course of the cheque within fifteen days of the receipt of the said notice.CC No-8327/09 Page 5 of 14
Explanation- For the purposes of this section, " debt or other liability" means a legally enforceable debt or other liability."
7. The Hon'ble Supreme Court in the case of Kusum Ingots & Alloys Ltd. Vs. Pennar Peterson Securities Ltd. & Others. AIR 2000 SC 954, has succinctly spelt out the essential ingredients for making out a case under section 138 NI Act. The same are quoted hereunder:
"i) a person must have drawn a cheque on an account maintained by him in the 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;
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 a 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 payment of the said CC No-8327/09 Page 6 of 14 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 unpaid;
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.
8. At this juncture it would be apropos to refer to the presumptions envisaged under the NI Act. Section 118(a) provides that every negotiable instrument shall be presumed to have been made or drawn for consideration. The Hon'ble Supreme Court in the case of Mallavarapu Kasivisweswara Rao Vs. Thadikonda Ramulu Firm & Ors. AIR 2008 SC 2898 has thus held:
"Under section 118 (a) of the negotiable instruments act, the court is obliged to presume, until the contrary is 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 CC No-8327/09 Page 7 of 14 either by direct evidence or by preponderance of probabilities showing that the existence of consideration was improbable, doubtful or illegal."
Further, according to section 139 of the act, a presumption is drawn against the drawer and in favour of the holder that "unless the contrary is proved, the holder of a cheque received the cheque for discharge, in whole or in part, of any debt or liability. In Hiten P. Dalal Vs. Bratindranath Banerjee (2001) 6 SCC 16, the Hon'ble Supreme Court has opined as under:
"22... It is obligatory on the court to raise this presumption (under section 139 NI Act) in every case where the factual basis for raising of the presumption had been established. It introduces an exception to the general rule as to the burden of proof in criminal cases and shifts the onus on to the accused. Such a presumption is a presumption of law, as distinguished from a presumption of fact which describes provisions by which the court 'may presume' a certain state of affairs. Presumption are rules of evidence and do not conflict with the presumption of innocence, because by the latter all that is meant is that the prosecution is obliged to prove the case against the accused beyond reasonable doubt. The obligation on the prosecution may be discharged with the help of presumptions of law or fact unless the accused adduces evidence CC No-8327/09 Page 8 of 14 showing the reasonable possibility of the non-existence of the presumed fact."
9. The accused in the instant case admitted his signatures on the impugned cheque. In the light of the ratio of the aforecited judgments, the presumptions under sections 118(a) and 139, NI Act are raised against the present accused. However, the said presumptions are rebuttable and can be dislodged by the accused on the strength of leading cogent and convincing evidence in support of his claim.
10. The defence of the accused is that he had handed over the cheque in question, which was a blank signed cheque, as security to the complainant at the time of entering into loan agreement, as a security for the loan. The case of the accused is that he had purchased a used Maruti Omni Car from one Nanak Chand for Rs. 1,20,000/- on 05.12.05 but the vehicle got stolen on the same night. It is further the case of the accused that he had informed the complainant about the same but the bank did not cooperate and later misused the security cheque.
11. The accused relied upon copy of letter issued by him to the complainant ExDW1/1 and untrace report Mark C issued by the SHO PS-Defence Colony, to show that the vehicle got stolen. The testimony of accused to this effect remains unrebutted.
12. The entire focus of the defence has been to show that the CC No-8327/09 Page 9 of 14 vehicle got stolen on the same day it was purchased and despite the fact having been intimated to the bank, the complainant bank still presented the cheque for encashment. The fact that the vehicle in question got stolen does not absolve the accused of his liability to repay the loan amount.
13. Further, no convincing piece of evidence has come on record to show that the cheque in question was taken by the complainant as security or that the same was not in discharge of any liability. Even if the installments were being paid through ECS, it does not preclude the accused from issuing a cheque to pay the overdue installments.
14. Ld. defence counsel has placed reliance on KK Sidharthan Vs. TP Praveena Chandran & Anr [1997] 24 CLA 126 (SC) and has argued that the complainant was aware about the fact that the account of the accused has been closed but despite that the cheque was presented. However, reliance on the above judgment would be of no avail to the complainant as the facts of the above case were completely different from the present case. In that case, the fact regarding stop payment was intimated to the complainant through notice and on the relevant date there was sufficient balance in the account of the accused to honour the cheque, which is not the case here.
15. It is not in doubt that whereas the standard of proof so far as the prosecution is concerned, is proof of guilt beyond CC No-8327/09 Page 10 of 14 reasonable doubt; the one on the accused is only mere preponderance of probabilities. However, the burden can be discharged by the accused by raising a probable defence by leading cogent and convincing evidence. There is no presumption of law that any and every statement made by the accused has to be taken as the gospel truth. The above discussed defence of the accused does not seem probable and is liable to be rejected.
16. As far as the legal notice is concerned, the accused denied that he received the same. Perusal of vakalatnama and bail bonds furnished on behalf of the accused would show that the address mentioned in these documents is same as the address on which the legal notice was sent. Further, it is not the case of the accused that the address mentioned in the complaint or notice is not his address.
17. Section 27, the General Clauses Act raises a presumption that where a notice has been sent to the correct address of the noticee by registered post then, unless the contrary is proved, 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. The accused has not led any evidence to show that he did not receive the legal notice. Mere bald statements of the accused do not lend any credence to the stand of the accused. As the accused failed to rebut the presumption, it is deemed that the legal notice of demand was duly served CC No-8327/09 Page 11 of 14 upon the accused.
18. As discussed earlier, the presumptions under section 118(a) as well as 139, NI Act are rebuttable. The onus on the accused to rebut the said presumptions can be discharged by bringing on record such facts and circumstances, upon consideration of which, the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that it did not exist. However, after examining the evidence on record, it can be concluded that the accused has failed to discharge the onus to rebut the presumptions.
19. In the light of the foregoing discussion and findings, it can be safely concluded that the complainant has successfully proved its case that there existed a legally enforceable liability, in discharge whereof the cheque in question was issued but, despite the service of notice, the accused failed to make payment within the stipulated period. Per contra, the accused has failed to rebut the presumptions raised against him. As the ingredients of section 138 of the NI Act are squarely made out in this case, the accused is convicted for the offence punishable under section 138 of the NI Act.
Announced in the open court on 30.05.12 (Gaurav Gupta) Metropolitan Magistrate (North East) Karkardooma Courts, Delhi.
CC No-8327/09 Page 12 of 14IN THE COURT OF SH. GAURAV GUPTA, METROPOLITAN MAGISTRATE (North East), KARKARDOOMA COURTS, DELHI.
CC NO.8327/09Unique case ID No.02402R0349872007 U/S. 138 N.I. Act PS - Vivek Vihar M/s HDFC Bank Ltd.
Versus Sandeep Kumar ORDER ON SENTENCE
1. I have heard both the sides on the quantum of sentence. I have also considered the aggravating as well as mitigating circumstances. It has been submitted on behalf of the complainant that the complainant has suffered at the hands of the convict. It has further been submitted that maximum sentence be imposed upon the convict and also that the complainant be compensated for the loss suffered by him.
2. Per contra, it has been submitted on behalf of the convict that a lenient view be taken. It has further been submitted that the convict does not have any criminal CC No-8327/09 Page 13 of 14 record and is the sole bread earner of his family and he needs to be given a chance to reform himself.
3. Keeping in view the facts and circumstances of the case and also the object behind enactment of section 138 NI Act, the convict is sentenced to undergo imprisonment till rising of the court. Further, the convict is directed to pay a compensation of Rs. 15,000/ (Fifteen Thousand) to the complainant within a period of 30 days from today. In case of default in payment of the compensation amount, the convict shall further undergo simple imprisonment for a period of one month.
Announced in the open court on 02.06.2012 (Gaurav Gupta) Metropolitan Magistrate (North East) Karkardooma Courts, Delhi.
CC No-8327/09 Page 14 of 14