Delhi District Court
Cheque In Question. In Ravi Chopra vs State & Anr, Hon'Ble High Court Of on 24 January, 2019
IN THE COURT OF METROPOLITAN MAGISTRATE,
KARKARDOOMA COURTS, DELHI.
Presided by: Sh. Sujit Saurabh
CC No. 55119/16
PS: Pandav Nagar
Smt. Munesh Kumari
W/o Sh. Radhey Shyam
R/o 62, Patparganj,
Opposite UNA Apartment,
Delhi-110091 ....... Complainant
VERSUS
1. Sh. Rajesh Khurana
S/o Sh. Kishan Lal Khurana
2. Smt. Soniya Khurana
W/o Sh. Rajesh Khurana
Both R/o 66-D,
Pocket-IV, Phase-I,
Mayur Vihar, Delhi-110091
...... Accused
Complaint under section 138 of the Negotiable
Instruments Act, 1881
Offence complained of : U/s 138 NI Act
Date of commission of offence : On expiry of 15
days from the date of
service of statutory
notice (sent on 15.07.2015)
Plea of Accused : Not guilty
Date of decision of the case : 24.01.2019
Final Order : Conviction
Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 1 /12
JUDGMENT
STATEMENT OF FACTS AND REASONS FOR DECISION
1. The accused is facing trial for commission of offence punishable u/s 138 of The Negotiable Instruments Act, 1881 (in short, NI Act).
2. Facts in brief:
As per complaint, the complainant and the accused were in friendly relationship. The accused had taken friendly loan from the complainant in sum of Rs.2,00,000/-(Two lacs only) on 20.08.2013 and had assured to return the same within year. When the complainant requested the accused persons to return the loan amount, the accused persons issued cheque bearing no.029485 dated 23.06.2015 in sum of Rs.2,00,000/-(Two lacs only) in favour of the complainant from their joint account no. 0877104000003018 maintained with IDBI Bank, branch at C-35 & 36, Acharya Niketan, Mayur Vihar Phase-1, Delhi-110091. The complainant presented the aforesaid cheque for encashment in her bank account no. 1518000100314857, maintained with Punjab National Bank, Patparganj, Delhi-110091.
The cheque was dishonored and returned unpaid to the complainant with endorsement "Funds insufficient" vide cheque return memo dated 25.06.2015. The complainant informed the accused persons the factum of dishonor of the cheque and requested them to make the payment in cash. The accused persons refused to make payment of the cheque amount. Thereafter, the complainant sent legal demand notice dated 08.07.2015 to the accused by speed post advising them to pay the amount of the cheque within 15 days of the receipt of the notice. The accused persons did not pay the cheque amount even after expiry of statutory period of 15 days from the date of service of notice. Since Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 2 /12 accused did not make payment to discharge their liability, the complainant filed the instant complaint.
3. Vide order dated 17.09.2015, cognizance of the offence u/s 138 NI of Act was taken by Ld. Predecessor court and the accused were summoned. On 28.11.2015, both the accused put up their appearance before the court.
4. Vide order dated 28.11.2015, notice u/s 251 of Criminal Procedure Code, 1973 (in short, "Cr.P.C") was served upon both the accused. The accused persons did not plead guilty and claimed trial.
On 18.12.2015, an application u/s 145(2) NI Act was moved on behalf of accused persons seeking permission to cross-examine the complainant witnesses. The application was allowed and the matter proceeded with complainant's evidence (in short "C.E.").
5. The complainant examined two witnesses in her favour including herself.
The complainant appeared in witness box as CW1. She adduced her evidence by way of affidavit Ex. CW1/A. She reiterated the facts mentioned in the complaint. She placed reliance on the following documents: -
a) Original cheque no.029485 dated 23.06.2015, Ex. CW 1/1,
b) Cheque return memo dated 25.06.2015 Ex. CW 1/2,
c) Legal demand notice dated 08.07.2015, Ex. CW 1/3,
d) Postal receipts Ex. CW1 /4 and Ex. CW1/5,
e) Return postal envelops of legal notice, Ex. CW1/6 and Ex. CW1/7,
f) Proof of delivery of legal notice Ex. CW1/8 and Ex. CW1/9 CW2 Sh. Radhey Shyam is husband of the complainant. He also led his evidence by way of affidavit Ex. CW2/A. The witnesses were cross-examined on behalf of accused.
Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 3 /12 Vide order dated 17.08.2017, CE was closed and matter was listed for examination of accused u/s 313 of Cr. PC.
6. On 09.10.2017, both the accused were examined u/s 313 of Cr. PC.
Accused Soniya Khurana denied that she along with her husband had taken loan of Rs.2,00,000/- (Two lacs only) from the complainant. However, she admitted that she had to pay Rs.30,000/- to Rs.40,000/- to the complainant for a committee. She stated that the cheque had been given to the complainant in blank signed condition as security for a committee under force from the complainant. She denied receipt of legal notice.
Accused Rajesh Khurana denied that he had family relation with the complainant and had taken loan of Rs.2,00,000/-(Two lacs only) from the complainant. He also stated that the cheque was given to the complainant as a security for a committee. He also denied receipt of legal notice.
The accused expressed their willingness to lead defence evidence (in short, DE). Accordingly, the matter was listed for DE.
7. The accused did not file list of defence witnesses despite sufficient opportunities. Hence, right of the accused persons to lead DE was closed vide order dated 01.06.2018 and the matter was listed for final arguments. Thereafter, an application u/s 315 of Cr.P.C was moved on behalf of accused persons for examination of accused persons as defence witness. The application was allowed vide order dated 03.08.2018.
8. Accused Sonia Khurana appeared in witness box as DW1. As per her testimony, in April 2014, she along with her husband had subscribed membership of a committee. The committee comprised of 15 members. The committee amount was Rs. 1,50,000/-. In the month of December 2014, they Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 4 /12 had taken committee amount of Rs. 1,50,000/-. The complainant had demanded a cheque against the committee amount. She had given a blank signed cheque under her signature and signature of her husband to the complainant as security cheque. They could not pay last three- four subscriptions of the committee.
Accused Rajesh Khurana appeared in witness box as DW2. The testimony of DW2 is similar to that of DW1.
9. I heard arguments on behalf of both the parties. The accused persons filed written argument also.
To prove his case, Ld. Counsel for complainant emphasized that the cheque in question had been issued by the accused in discharge of their legal liability and all the ingredients of offence u/s 138 of NI Act are full filled in the instant case. Ld. Counsel further emphasized that the accused failed to rebut the statutory presumption in favour of the complainant.
On the other hand, Ld. Defence counsel laid emphasis on the following facts to seek acquittal of accused:
a) The accused had not issued the cheque for discharge of any liability. They had issued the cheque as security for a committee run by the complainant.
b) The accused had not received the legal demand notice.
c) The particulars of the cheque had not been filled up by the accused.
They had given blank signed cheque to the complainant.
d) The complainant failed to prove the source of alleged loan amount.
10. Since accused is facing trial for commission of offence punishable u/s 138 of NI Act, it is necessary to discuss the essential ingredients of the offence.
To attract offence u/s 138 NI Act, following requirements must be fulfilled: -
Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 5 /12
(i) that cheque is presented to the bank within the period of six months or its validity, whichever is earlier;
(ii) 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 30 days of the receipt of information by him from the bank regarding the return of the cheque as unpaid;
(iii) 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.
11. Adverting to the facts of the case, in notice u/s 251Cr.P.C the accused admitted their signatures on the cheque in question. They also admitted that they had issued the cheque to the complainant and that the cheque pertained to their joint account. Factum of dishonor of the cheque is not in dispute. It is also not in dispute that the cheque was presented within statutory period. Dispatch of legal notice within statutory time limit is also not in dispute. Institution of the complaint within limitation is also not in dispute. However, the accused have disputed receipt of legal demand notice Thus, the basic questions for determination are:
a) Whether the accused had issued the cheque in discharge of debt or legal liability?
b) Whether the accused had received the legal notice?
12. So far as receipt of legal notice by the accused persons is concerned, statutory presumption lies in favour of the complainant. In C.C. Alavi Haji vs Palapetty Muhammed & Anr, Appeal (crl.) 767 of 2007, Hon'ble Supreme Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 6 /12 Court held:
"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."
xxx xxx xxx "In our opinion, therefore, when the notice is sent by registered post by correctly addressing the drawer of the cheque, the mandatory requirement of issue of notice in terms of Clause (b) of proviso to Section 138 of the Act stands complied with."
xxx xxx xxx "Any drawer who claims that he did not receive the notice sent by post, can, within 15 days of receipt of summons from the court in respect of the complaint under Section 138 of the Act, make payment of the cheque amount and submit to the Court that he had made payment within 15 days of receipt of summons (by receiving a copy of complaint with the summons) and, therefore, the complaint is liable to be rejected. A person who does not pay within 15 days of receipt of the summons from the Court along with the copy of the complaint under Section 138 of the Act, cannot obviously contend that there was no proper service of notice as required under Section 138, by ignoring statutory presumption to the contrary under Section 27 of the G.C. Act and Section 114 of the Evidence Act."
In the instant case, the legal notice had been sent by speed post vide postal receipt Ex. CW1/4 and Ex. CW1/5 on the address of the accused persons. The speed post envelopes addressed to the accused persons Ex. CW1/6 and Ex. CW1/7 were returned back to the complainant with endorsement 'Unclaimed' 'Intimation'.
Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 7 /12 In view of statutory presumption u/s 27 of the General Clauses Act and Section 114 of the Evidence Act, the requirement of service of notice u/s 138 of NI Act stands complied.
13. The plea of accused that the particulars of the cheque in question had not been filled up by them is of no help in view of their admitted signature on the cheque in question. In Ravi Chopra vs State & Anr, Hon'ble High Court of Delhi held:
"Section 20 NI Act talks of "inchoate stamped instruments" and states that if a person signs and delivers a paper stamped in accordance with the law and "either wholly blank or have written thereon an incomplete negotiable instrument" such person thereby gives prima facie authority to the holder thereof "to make or complete as the case may be upon it, a negotiable instrument for any amount specified therein and not exceeding the amount covered by the stamp."
xxx xxx xxx "A collective reading of the above provisions shows that even under the scheme of the NI Act it is possible for the drawer of a cheque to give a blank cheque signed by him to the payee and consent either im- pliedly or expressly to the said cheque being filled up at a subsequent point in time and presented for pay- ment by the drawee. There is no provision in the NI Act which either defines the difference in the hand- writing or the ink pertaining to the material particu- lars filled up in comparison with the signature thereon as constituting a 'material alteration' for the Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 8 /12 purposes of Section 87 NI Act. What however is es- sential is that the cheque must have been signed by the drawer."
14. In Sampelly Satyanarayana Rao Versus Indian Renewable Energy Development Agency Limited (decided on19 September, 2016), Hon'ble Supreme Court discussed the issue of security cheque. The question for consideration was: whether the dishonour of a post-dated cheque given for repayment of loan installment which is also described as security in the loan agreement is covered by Section 138 of the Negotiable Instruments Act, 1881? It was held that dishonour of cheque being for discharge of existing liability is covered by Section 138 of the Act.
In Suresh Chandra Goyal vs Amit Singhal (date of decision 14.05.2015), Hon'ble High Court of Delhi observed:
"59. Thus, when one party gives a security to the other, implicit in the said transaction is the understanding that in case of failure of the principal obligation, the security may be enforced.
61. Thus, in my view, it makes no difference whether, or not, there is an express understanding between the parties that the security may be enforced in the event of failure of the debtor to pay the debt or discharge other liability on the due date. Even if there is no such express agreement, the mere fact that the debtor has given a security in the form of a postdated cheque or a current cheque with the agreement that it is a security for fulfillment of an obligation to be discharged on a future date itself, is sufficient to read into the arrangement, Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 9 /12 an agreement that in case of failure of the debtor to make payment on the due date, the security cheque may be presented for payment, i.e. for recovery of the due debt. If that were not so, there would be no purpose of obtaining a security cheque from the debtor. A security cheque is issued by the debtor so that the same may be presented for payment. Otherwise, it would not be a security cheque"
In the instant case, the accused have repeatedly stated that they had issued the cheque in question as security cheque. The accused have also admitted that they have some liability towards the complainant, though they have denied the liability of cheque amount and the factum of loan allegedly granted by the complainant.
15. Section 118 of the NI Act inter alia provides that it shall be presumed, until the contrary is proved, that every negotiable instrument was made or drawn for consideration.
Section 139 of the NI Act stipulates that unless the contrary is proved, it shall be presumed, that the holder of the cheque received the cheque, for the discharge of, whole or part of any debt or liability. However, the said presumptions are rebuttable in nature.
In Rangappa V. Sri Mohan, (2010) 11 SCC 441, a three- judge bench of Apex Court observed that, Section 139 of the NI Act is stated to be an example of a reverse onus clause which is in tune with the legislative intent of improving the credibility of negotiable instruments.' The Hon'ble Supreme Court further observed that the offence under Section 138 of the NI Act is at best a regulatory offence and largely falls in Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 10 /12 the arena of a civil wrong and therefore the test of proportionality ought to guide the interpretation of the reverse onus clause. An accused may not be expected to discharge an unduly high standard of proof. A reverse onus clause requires the accused to raise a probable defence or creating doubt about the existence of a legally enforceable debt or liability for thwarting the prosecution. The standard of proof for doing so would necessarily be on the basis of "preponderance of probabilities" and not "beyond shadow of any doubt".
16. In the instant case, the accused have taken the defence that the complainant was running a commitee and they were members of the committee. They stated that the committee comprised of 15 members and the amount of committee was Rs.1,50,000/-. The subscription of the committee was Rs.10,000/- per month. They have further stated that they had taken the committee amount of Rs.1,50,000/- in the month of December 2014. However, they failed to bring on record any document to show that the complainant was running a committee and they were members of the commitee run by the complainant. They also failed to bring on record any receipt of payment of subscription of the committee. They also failed to bring on record any document to show that they had taken committee amount of Rs.1,50,000/-. They failed to examine any other member of the alleged committee.
17. So far as capacity of the complainant to grant the loan amount is concerned, she has explained the same. The complainant has stated that her husband is a government teacher. This fact is not disputed. The complainant has further stated that she had taken loan of Rs.5,75,000/- from Pradhan Mantri Khadi Rojgar Yojna and she was running a business of readymade garments for Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 11 /12 10 years.
18. On the basis of above discussed facts and law it is evident that the accused have failed to rebut the statutory presumptions in favour of the complainant. Accordingly, accused namely Sh. Rajesh Khurana and Smt. Sonia Khurana are convicted for offence punishable u/s 138 of NI Act.
Copy of the judgment be given to the convicts free of cost.
Digitally signed by SUJIT SUJIT SAURABH
SAURABH Date: 2019.01.24
16:30:15 +0530
Announced in the open court (SUJIT SAURABH)
today i.e. 24.01.2019 MM (Municipal, East)
Karkardooma Court, Delhi
24.01.2019
Munesh Kumari v. Rajesh Khurana and Ors CC No. 55119/16 page no. 12 /12