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Delhi District Court

In Re vs State on 10 November, 2020

           IN THE COURT OF MR. DHARMESH SHARMA
     PRINCIPAL DISTRICT & SESSIONS JUDGE : WEST DISTRICT
                   TIS HAZARI COURTS : DELHI


Criminal Revision No. 197/2019
CNR No. DLWT01-005112-2019

In re:
Jagdish Prasad Sharma
S/o Shri Krishan Lal Sharma
R/o Shri Nav Durga Mandir
Plot No. 190, Prince Road
Tagore Park, Delhi-110 009.                                . . . . Petitioner/revisionist
         Versus
State                                                      . . . . Respondent

         Date of Institution                    :          05.07.2019
         Date of hearing arguments              :          04.11.2020
         Date of order                          :          10.11.2020
Appearances:
Sh. Nitin Ahlawat, Advocate for the petitioner/revisionist.
Sh. Atul Kumar Shrivastava, Ld. Addl. PP for the State/respondent.
Sh. Manoj Kumar Singh, Advocate for the complainant.

ORDER

1. This Criminal revision petition is filed by the petitioner/revisionist/accused under Section 397 read with Section 399 of the Code of Criminal Procedure, 1973, whereby he has assailed an order dated 30.04.2019 followed by another order dated 16.05.2019, whereby the Ld. Court of Sh. Babru Bhan, the then Ld. MM-04 (West), THC, Delhi, in a case No.2933/2018 arising out of FIR No. 98/2014 PS Khyala was pleased to frame charge against the petitioner-accused CR No. 197/2019 Jagdish Prasad Sharma v. State Page 1 of 9 under Section 406 of the IPC.

FACTUAL BACKGROUND

2. In a nutshell, the petitioner filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (hereinafter referred to as "NI Act") against respondent Ashok Kumar with regard to dishonour of three cheques viz., cheque No. 662571 dated 15.03.2013 for Rs. 6,80,000/-; cheque No. 662572 dated 20.03.2013 for Rs. 7,50,000/-; and cheque No. 662573 dated 25.03.2013 for Rs.7,25,000/-, all drawn by the drawer Ashok Kumar on State Bank of India, Raghubir Nagar Branch, New Delhi totaling Rs. 21,55,000/-. It admitted case that the said cheques were on account of "insufficient funds" in the bank account of the drawer Ashok Kumar, who is the respondent/complainant in the present revision petition, vide memo dated 26.03.2012; and that a legal notice dated 25.04.2013 was served upon the drawer Ashok Kumar, which was also replied by him. It is also admitted fact that on the filing of the said complaint u/s. 138 of the NI Act, summons have been issued to the drawer Ashok Kumar, who has appeared and even filed an application u/s. 145(2) of the NI Act.

3. While the said proceedings u/s. 138 of the NI Act are sub judice, the drawer Ashok Kumar filed a complaint against the petitioner/payee Jagdish Prasad Sharma u/s. 200 read with Section 199 Cr.P.C. for launching prosecution against him u/s. 406/403/465/467/506 of the IPC sometime in July, 2013. The complainant Ashok Kumar, who is the drawer of the cheques, alleged that the parties were known to each other for about 25 years and way CR No. 197/2019 Jagdish Prasad Sharma v. State Page 2 of 9 back in the year 2002, he was a member of three local committees/chits for money deposits, which was being run by the accused Jagdish Prasad Sharma and he availed the benefit of the committees and subscribed to the committee-fund/chits for Rs. 60,000/- +Rs.50,000/-+Rs/1,00,000/- totaling Rs. 2,10,000/-; and that he made timely repayment of the same. He alleged that at the time of opting for said committee-fund/chits, accused Jagdish Prasad Sharma had taken three cheques as security for various advance payments received by him; and that although he had paid the entire dues, whenever he asked the accused Jagdish Prasad Sharma to return the same, the latter told him that the cheques had been misplaced and he promised to return the same as and when he finds the said cheques. The complainant Ashok Kumar alleged that he was shocked to receive the legal notice dated 25.04.2013 with regard to the three cheques and alleged that the cheques were given in blank and the contents of the same have been forged and the accused Jagdish Prasad Sharma have attempted to obtain wrongful gain for himself and thereby has caused wrongful loss to him.

4. Briefly stated, on the said complaint, Sh. Rajinder Kumar, the then Ld. MM-04 (West), THC, Delhi vide order dated 04.02.2014 not only took cognizance of the offence but also directed registration of the FIR in the present case, and accordingly, the instant FIR No. 98/2014 PS Khyala u/s. 406 IPC was registered on 11.02.2014 at 10.00 hours. After investigation, the final police report was filed on 02.05.2018. The impugned order dated 30.04.2019 reads as under :-

State Vs. Jagdish Prasad Sharma CR No. 197/2019 Jagdish Prasad Sharma v. State Page 3 of 9 PS Khyala New Case No. 2933/2018 30.04.2019 Present : Ld. APP for State.

Accused with counsel.

The case of the prosecution is that accused used to operate some chit funds in the year 2003. Complainant Ashok Kumar was subscriber to some of such chit funds. The complainant had obtained the prize money of some chit funds. To ensure the payment of remaining installments, accused obtained three cheques bearing no.662571, 662572 and 662573 from the complainant. Complainant has alleged that he had made the entire payment to the complainant towards the chit funds. In the year 2013 accused filed a case u/s 138 NI Act against the complainant allegedly misusing the cheques which were issued towards chit fund. In the said case under the provisions of NI Act, accused alleged that complainant had obtained a loan of Rs. 21,00,000/- from the accused whereas the complainant never availed such loan.

Arguments have already been heard.

During course of investigation, IO of the case recorded statement of some other subscribers of the chit funds which were being run by the accused and they confirmed that accused was operating a chit fund and used to take security cheques. Further, Rs. 21,00,000/- is a huge amount but the accused failed to produce any document regarding the said loan. When entire circumstantial evidence is taken into consideration, same is sufficient to show that the accused had taken the cheques towards the security of chit funds but subsequently misappropriated the same.

The material on record is sufficient to frame the charges for offence u/s 406 IPC.

Be put up for framing of formal charge on 16.05.2019.

Sd/-

(BABRU BHAN) MM-04:West:THC:Delhi 30.04.2019"

5. Accordingly, vide impugned order dated 16.05.2019, charge u/s. 406 of the IPC was framed against the petitioner/accused, to which, he pleaded not guilty and claimed trial.

BRIEF LEGAL SUBMISSIONS

6. Mr. Nitin Ahlawat, the learned Counsel for the petitioner-

accused has vehemently urged that the respondent/complainant has admitted that the cheques were signed by him and even if his case is believed that the cheques were handed over as security, the petitioner / accused is the holder of the cheques and cannot be prosecuted u/s. 406 of the IPC, the ingredients of which are not made out at all. It is vehemently urged that the case of the complainant is by way of a defence or counter blast to the complaint u/s. 138 of the NI Act filed by him and no parallel proceedings can continue since this would rather lead to multiplicity of proceedings and would result in conflicting judgments.

7. On the other hand, Mr. Manoj Kumar Sharma, ld. Counsel for the complainant has vehemently urged that his client has an independent legal right against the petitioner/accused who has endeavoured to derive undue advantage for the cheques, which were delivered in blank and have been fabricated to his detriment.

DECISION

8. I have given my anxious consideration to the submissions made by the ld. Counsel for the parties including Ld. Addl. PP for the State. No case law has been relied or cited at the Bar by the ld counsel for the parties. I have also perused the relevant record of the case including the Trial Court record. Let us first understand, what is the offence of criminal breach of trust, which is defined by section 405 of the Indian Penal Code as under:

"Whoever, being in any manner entrusted with property, or with any dominion over property, dishonestly misappropriates or converts to his own use that property, or dishonestly uses or CR No. 197/2019 Jagdish Prasad Sharma v. State Page 5 of 9 disposes of that property in violation of any direction of law prescribing the mode in which such trust is to be discharge, or of any legal contract, express or implied, which he has made touching the discharge of such trust, or wilfully suffers any other person so to do, commits "criminal breach of trust".

9. Thus to constitute the offence of criminal breach of trust, there must be first entrustment of a property or allowing the other per- sons dominion over the property and secondly dishonest misappropria- tion by the offender in whom such trust or confidence was reposed and the property was entrusted. Thirdly, the misappropriation should be in violation of any direction of law prescribing the mode in which such trust is to be discharged, or in violation of any legal contract touching the discharge of such trust. The word 'property' is in defined under the Indian Penal Code and section 405 of the IPC is not qualified by the term movable. In the case of Jilubhai Nanbhai Khachar v. State of Gujarat, 1995 Supp (1) SCC 596, the word "Property" was interpreted to mean in legal sense as:

".....an aggregate of rights which are guaranteed and protected by law. It extends to every species of valuable right and interest, more particularly, ownership and exclusive right to a thing, the right to dispose of the thing in every legal way, to possess it, to use it and to exclude everyone else from interfering with it. The dominion or indefinite right of use or disposition which one may lawfully exercise over particular things or subjects is called property. The exclusive right of possessing, enjoying and disposing of a thing is property in legal parameters. Therefore, the word "property" connotes everything which is subject of ownership, corporeal or incorporeal, tangible or intangible, visible or invisible, real or personal; everything that has an exchangeable value or which goes to make up wealth or estate or status. Property, therefore, within the constitutional protection, denotes group of rights inhering citizen's relation to physical thing, as right to possess, use and dispose of it in accordance with law,"

10. Therefore, a negotiable instrument in the nature of a 'cheque' is per se a property and section 405 of the IPC can squarely be invoked. Having said that, framing the impuged charge merely on the ground that the petitioner-accused failed to produce any documents, when admittedly no documents were ever executed or drawing inference of criminality on account of failure of the appellant/accused to explain source of such funds is something that is not palatable since no reverse burden of proof can be placed on the shoulders of the petitioner-accused. If such reverse burden is placed in proceedings under the Indian Penal Code, it might be prejudicial to the petitioner-accused or payee in the complaint case under section 138 of the NI Act.

11. It is admitted case of the complainant Ashok Kumar that he had entrusted signed blank cheques to the petitioner-accused as security for the committee funds/chits opted by him. Thus, the main plank of the complaint case by the drawer Ashok Kumar is in the nature of his defense to the ongoing proceedings in the complaint case u/s 138 of the NI Act at the behest of the present petitioner-revisionist. Once the said aspect is admitted, the presumption under Section 139 of the N.I. Act is attracted in favour of the "holder" of the cheque i.e., the petitioner-accused in this case who is the payee too. Of-course, the na- ture of presumption under Section 139 of the N.I. Act, if read with Sec- tion 118 (e) of Indian Evidence Act are rebuttable but then the burden to disprove that cheques were not issued in respect of antecedent liability or legally recoverable debt lies upon the drawer i.e. the complainant in the present complaint. Since there are disputed questions of facts in-

volved in the proceedings under the special enactment i.e. N.I. Act, without further ado it would be travesty of justice if the prosecution aris- ing out of the complaint by the drawer Ashok Kumar is allowed any fur- ther.

12. It has been rightly pointed out by the ld. Counsel for the petitioner/revisionist that if such parallel disposition were allowed, it would lead to multiplicity of the proceedings and conflicting judgments. The very substratum of the complaint by drawer Ashok Kumar is in conflict with the special laws on the subject. There is well known dictum that "a special law prevails over the general law". The enforcement of financial discipline, when it comes to issues of consideration, issuance and honouring of cheques, is in the domain of a special law in the shape and nature of the NI Act. There is plethora of case law to the effect that it is possible for a drawer of the cheque to give blank cheque signed by him to the payee and consent either implied or expressly that other relevant details would be filled by him in the cheque at a subsequent point in time and may be presented for payment.

13. Without delving into the merits of the case, this Court need not go further in the realm of Section 20 of the NI Act pertaining to inchoate instruments and with regard to issues of filling up of the details and/or handwriting in the cheques in terms of Section 87 of the NI Act.

14. To sum up, since the entrustment of the cheques in question by the complainant / drawer Ashok Kumar was a lawful exercise, whether or not it has been manipulated or fabricated as to the relevant details, would not per se amount to "misappropriation" within the fold of Section 405 of the IPC. At the cost of repetition, no reverse burden of proof can be placed on the shoulders of the petitioner-

accused in the instant case to prove the source of funds. This Court cannot allow two parallel proceedings in respect of same cause of action as it would lead to multiplicity of proceedings and conflicting judgments. I, therefore, find that impugned order dated 30.04.2019 for framing of charge under Section 405 of the IPC followed by order dated 10.05.2019, on which date charge was framed and put to the petitioner- accused cannot sustained in law.

FINAL ORDER

15. In view of the aforesaid discussion, the present revision petition is allowed. The impugned orders dated 30.04.2019 followed by order dated 16.05.2019 are set aside. The petitioner/revisionist is hereby discharged. There is no gainsaying that in case the drawer Ashok Kumar is able to rebut the presumption and bring out in the proceedings under Section 138 of the NI Act that the cheques have been manipulated or fabricated, there would lay separate penal consequence as per law against the petitioner-accused or payee. Nothing contained herein shall tantamount to an expression of opinion on the merits of the case in the pending proceedings under Section 138 of NI Act.

16. The Trial Court record along-with copy of this order be sent back to the Ld. Trial Court for information and record. A copy of this order be sent to the learned Counsel for the parties on their email IDs. File of revision petition be consigned to Record Room.

                                                                  Digitally signed by
                                                       DHARMESH   DHARMESH SHARMA

                                                       SHARMA     Date: 2020.11.11
                                                                  18:28:31 +0530

Announced in the open Court          (DHARMESH SHARMA)
     th
on 10 November, 2020        Principal District & Sessions Judge (West)
                                     Tis Hazari Courts: Delhi



CR No. 197/2019                Jagdish Prasad Sharma v. State                   Page 9 of 9