Delhi District Court
Icici Bank Ltd. vs . Kumar Agro Food Products on 19 December, 2014
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IN THE COURT OF MS. NEETI SURI MISHRA : LD. METROPOLITAN
MAGISTRATE : SPECIAL COURT - 08 (NI ACT) : DWARKA : DELHI
IN THE MATTER OF :-
ICICI BANK LTD. Vs. KUMAR AGRO FOOD PRODUCTS
Complaint Case No. : 1130/14/10
P.S. : Connaught Place
U/s. : 138 & 141 N.I. Act
J U D G M E N T
1. Name of the complainant : ICICI Bank Ltd.
(Through Authorised Representative)
S.D Tower, 2nd Floor, Rohini,
Sector - 8, New Delhi
2. Name of the accused
and address : M/s. Kumar Agro Food Products
Through It's PropAlaknanda Kumar
H NO 489 Sector 9,
Behind Gyan Devi School,
Gurgaon 122001.
3. Offence complained of : U/s.138 N.I.Act
4. Plea of accused : Pleaded not guilty
5. Final Order : Convicted
6. Date of Reserving the : 18.12.2014
Judgment
7. Date of Order : 19.12.2014
Date of Institution of case : 16.09.2010
Date of Decision of the case : 19.12.2014
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JUDGMENT
BRIEF REASONS FOR THE DECISION
1. It is the case of the complainant that the accused in this case being the Proprietor of Kumar Agro Food Products, was sanctioned an overdraft facility under the scheme of Overdraft Facility (Smart Business Loan) for a sum of Rs. 7,00,000/- (Rupees Seven Lakhs), for her business purpose and the accused had promised to make regular repayment of the loan as per the agreement executed by the parties. But since the accused failed to make regular repayment of the installments, she accordingly issued a cheque bearing No. 778392 dated 09/03/2010 for a sum of Rs.7,00,000/- drawn on State Bank of India in favour of the complainant. The cheque in question got dishonoured and despite receipt of the legal demand notice, the accused failed to make the payment of the cheque amount within the statutory period.
2. The accused in this case has chosen not to lead her defence evidence. Be that as it may, it is established position of law that leading of defence evidence is not mandatory for the accused. Hon'ble Supreme Court in Rangappa v. Shri Mohan, (2010) 11 SCC 441, observed that:
"Therefore, if the accused is able to raise a probable defence which creates doubts about the existence of a legally enforceable debt or liability, the prosecution can fail. As clarified in the citations, the accused can rely on the materials submitted by the complainant in order to raise such a defence and it is conceivable that in some cases the accused may not need to adduce evidence of his/her own."
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3. To discern whether the guilt of the accused has been firmly established by the complainant, it appears a pre-requisite to examine the ingredients of Section 138 Negotiable Instruments Act, which are as follows:
a) a person has 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;
b) the cheque has been issued for the discharge, in whole or part, of any debt or other liability.
c) the 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;
d) the cheque shall be returned by the bank unpaid, either because of the amount of money standing to the credit of that 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 that bank;
e) 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;
f) 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.
4. In her statement recorded under Section 313 r/w Section 281 Cr.P.C. the accused admits that she had availed the overdraft facility from the complainant vide Loan account no. 603805012552. She has further admitted her signature on the cheque in question, thereby, giving rise to the presumptions under Section 118(a) and Section 139 NI Act, in favour of the complainant.
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5. So what needs to be checked at the outset, is extent of the liability of the accused on the date on which the cheque was drawn. A bare perusal of Ex. CW 1/B, the cheque in question shows that the cheque of Rs.7,00,000/- (Rupees Seven Lacs only) was drawn on 09/03/2010. The Statement of Account alongwith the duly recorded Certificate under Section 2A of the Bankers' Books Evidence Act, Ex.CW1/C, demonstrates the liability of accused as Rs.7,87,404/- (Rupees Seven Lacs Eighty Seven Thousand Four Hundred Four) (inclusive of interest) on 26/02/2010. Since her liability on 09/03/2010 was more than the cheque amount, it becomes unambiguously clear that the cheque in question was issued by the accused for the discharge of her legally enforceable debt remaining outstanding towards the complainant bank, particularly when the accused has failed to establish that the cheque in question was given as a security cheque. The Hon'ble High Court of Delhi in V.S. Yadav v. Reena, (Decided on 21st December, 2010) has observed that:
"It must be borne in mind that the statement of accused under Section 281 Cr.P.C. or under Section 313 Cr.P.C. is not the evidence of the accused and it cannot be read as part of the evidence. The accused has an option to examine himself as a witness. Where the accused does not examine himself as a witnesss, his statement under Section 281 Cr.P.C. or Section 313 Cr.P.C. cannot be read as the evidence as accused and it has to be looked into only as an explanation of the incriminating circumstance and not as evidence. There is no presumption of law that explanation given by the accused was truthful. In the present case, the accused in his statement stated that he had given cheques as security. If the accused wanted to prove this, he was supposed to appear in the witness box and testify and get himself subjected to cross-examination. His explanation that he had the cheques as security for taking loan from the complainant but no loan was given should not have been considered by the Trial Court as his evidence and this was liable to be rejected since the accused did not appear in the witness box to dispel the presumption that the cheques were issued as security.
C.C no. 1130/14 ICICI Bank Ltd. vs. M/s. Kumar Agro Food- Products 4 of 9 5 Mere suggestions to the witness that cheques were issued as security or mere explanation given in the statement of accused under Section 281 Cr. P.C., does not amount to proof."
In view of the law established, I am of the opinion that the accused has failed to rebut the presumption raised in favour of the complainant under Section 118(a) and Section 139 NI Act. Moreover, apart from a bare assertion in her Statement recorded under Section 313 Cr.P.C. r/w Section 281 Cr.P.C., that the Statement of Account Ex. CW 1/C, is a false statement, no attempt has been made to assail the veracity of the same in the examination of CW1 AR of the complainant. Hence the liability of the accused stands established.
6. At the stage of framing of notice, the accused submitted that though the signature on the cheque in question is her, but she had not filled the rest of the contents. In this regard in a there are catena of landmark judgments by the Hon'ble Superior Courts of Ravi Chopra v. State and Anr., 2008 (2) JCC (NI) 169, Vijender Singh v. M/s Eicher Motors Limited & Anr. Crl. M.C. No. 1454/ 2011 decided on 05.05.2011, Tarun Gautam v. State, Crl.M.C. No. 529/ 2012 decided on 13.02.2012 and Manoj Sharma v. Anil Aggarwal, Crl.M.C. 1325/ 2012 decided on 20.04.2012, where it has been held that no law requires that the body of the cheque should be filled by the drawer or that the ink should be same. It is settled law that when a person issues a cheque, he authorizes the other person to fill the other particulars in the cheque. The contention of the accused is therefore liable to be rejected.
7. The next question to be addressed is in the context of Ex. CW 1/E, Legal Demand Notice dated 26.07.2010. The accused has since the inception denied the C.C no. 1130/14 ICICI Bank Ltd. vs. M/s. Kumar Agro Food- Products 5 of 9 6 receipt of the legal demand notice. However, the receipt of the Post Office MBC Vashi Navi Mumbai-400703 has been annexed as Ex. CW 1/ F, wherein the address of the accused has been correctly mentioned and it also bears the stamp of the post office. In light of these circumstances, the settled position of law is that since the accused has not disputed the correctness of his address, he cannot dispute the receiving of legal demand notice. There is sufficient material on record to raise a deemed presumption of service of legal demand notice in terms of Section 27 of the General Clauses Act. A three judges bench of the Hon'ble Supreme Court in C.C. Alavi Haji v. Palapetty Muhammed and Another (2007) 6 SCC 555 has held that:-
"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 our view, any other interpretation of the proviso would defeat the very object of the legislation."
Thus the contention of the accused does not hold water and is hence rejected.
8. In her Statement recorded under Section 313 Cr.P.C. r/w Section 281 Cr.P.C., the accused has also for the first time taken the defence that she had already repaid the loan amount to the complainant. However, no evidence pertaining to this contention has been put forth by the accused and hence the same stands rejected at the outset.
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9. Additionally, the accused has sought to assail the authority of CW 1 the Authorized Representative of the Complainant, on the ground that the Board Resolution authorizing him does not exist. The Power of Attorney dated 5th March, 2010, duly stamped and notarized has been annexed as Ex. CW 1/ A by the complainant, which authorizes Mr. Bhaskar Mishra the Debt Service Manager to represent the bank in the present complaint. Section 85 Indian Evidence Act stipulates:
"Presumption as to powers of attorney. - The court shall presume that every document purporting to be a power of attorney, and to have been executed before, and authenticated by, a notary public, or any court, judge, magistrate, Indian Consul or Vice-Consul, or representative of the Central Government, was so executed and authenticated."
9.1. It is established position of law that if a document is duly executed and notarized before the Notary Public, the court shall presume that the document was duly executed and notarized. The Hon'ble High Court of Delhi in Citibank N.A. vs Juggilal Kamlapat Jute Mills Co, AIR 1982 Delhi 487 observed as that:
"24. In the absence of any provision contained in s. 85 of the Evidence Act, any party to a suit, etc., relying on a power of attorney would have to prove it like any other document by producing in the witness- box the executant of the document, or the person in whose presence it was so executed, or the person acquainted with the signatures of the executant, etc., as the case may be. If that party is a company corporated in India or in any other country, it would be further required to prove that the person or persons executing the power executing the power of attorney on its behalf had been duly authorised by means of a resolution duly passed in accordance with law and the articles of association. The purpose of s. 85, in my view, is to eliminate all this cumbersome evidence in case such a power of attorney is C.C no. 1130/14 ICICI Bank Ltd. vs. M/s. Kumar Agro Food- Products 7 of 9 8 executed before and authenticated by a notary public, or other authorities mentioned therein. If evidence to prove these facts except the fact of execution by the executant was insisted upon, most of the purpose of s. 85 would be frustrated specially in these days of prevalent international trade."
Thus even if the Board Resolution authorizing the executants to further authorize CW1 AR, has not been filed by the complainant, the same shall have little bearing on the authority of the AR to represent the complainant bank in the present complaint. It must be borne in mind that Section 85 Evidence Act only raises a mandatory presumption of law, which can be rebutted by the accused. But in the present case the accused has failed in doing so. Hence in view of the law established, the contention of the accused is rejected.
10. The accused has relied on certain judgments of the Hon'ble High Courts. She has first placed reliance on Kulvinder Singh v. Kafeel Ahmed, 2013 (1) DCR
417. The decision in this case cannot be applied to the present case as facts of that case are entirely different from the facts of the present one.
11. Secondly, to challenge the authority of CW1 AR the accused has filed the decision of M/s Verdhman India Products v. Sulkshan Luthra, 2013 (1) DCR 2203, but again the present decision does not apply to the facts of the present case inasmuch as the complainant in the decision cited was a partnership firm, whereas the complainant in the present matter is a company. Further, the decision of Surendranagar Mercantile Cooperative Bank Through Recovery Officer v. State of Gujarat, 2013 (1) DCR 178, has been to challenge the authority of the Authorized Representative of the Complainant. But this judgment is inapplicable in the facts of the present case as the accused herein was acquitted due to lapse on the part of the complainant bank to file the authority letter of the authorized representative.
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12. Accused has further relied on decisions of S. Valayapathy v. G. Bernardsha Samuel, 2012 (2) DCR 792 (Madras High Court), M/S Aswin Papers v. B.G. Kalathil, 2013 (2) DCR 427 (Kerala High Court), Hari Ram Sariwala @ Hari Ram v. State of Jharkhand, 2012 (2) DCR 156 (Jharkhand High Court), Syed Isteyaque Ali v. The State of Jharkhand & Anr., 2012 (2) DCR 126 (Jharkhand High Court), wherein inter alia other issues, the aspect of Burden of Proof has been discussed. In this regard, the decision of the Hon'ble Supreme Court in M.S. Narayana Menon v. State of Kerala, (2006) 6 SCC 39 and Bharat Barrel & Drum Manufacturing Company v. Amin Chand Payrelal [(1999)3 SCC 35], are the landmark authorities. Moreover, the above-mentioned decisions cited on behalf of the accused differ in respect of facts.
13. Hence in the given circumstances, I am of the view that the accused has not been able to rebut the mandatory presumptions of law. I therefore, hold the accused Alaknanda Kumar, the Proprietor of M/S Kumar Agro Food Products, guilty. She is convicted for the offence charged i.e. under Section 138 Negotiable Instruments Act.
14. Let the parties be heard on the point of sentence.
15. A copy of this order be placed on the official website of the district courts.
ANNOUNCED IN OPEN COURT ON 19th day of DECEMBER, 2014 (NEETI SURI MISHRA) METROPOLITAN MAGISTRATE SPECIAL COURT NO.08, NI ACT DWARKA, NEW DELHI Total Pages 9 C.C no. 1130/14 ICICI Bank Ltd. vs. M/s. Kumar Agro Food- Products 9 of 9