Delhi District Court
Ishwar Singh vs Poonam Gupta & Anr. on 16 November, 2021
Ishwar Singh Vs Poonam Gupta & Anr.
IN THE COURT OF SPL. JUDGE: NDPS/ASJ: NORTH DISTRICT: ROHINI
COURTS:DELHI
CR Rev. No. 92/2020
Ishwar Singh
S/o Sh. Ram Phal
R/o A-116, Ground Floor
Prashant Vihar, Delhi-110086.
........................ Appellant
Versus
1. Poonam Gupta
Proprietor of M/s Bhavya Enterprises
At F-103, First Floor, Aditya Chamber-1
D Block, Central Market
Prashant Vihar, Delhi-110085.
2. The State (Govt. of NCT)
.......................Respondents
Date of institution : 09.10.2020
Arguments concluded : 09.10.2021
Date of decision : 16.11.2021
Judgment
1. This is an appeal against the impugned judgment dated 29.07.2020 and order on sentence dated 10.09.2020 passed by the court of Ms. Niharika Kumar Sharma, Ld. MM in the complaint case bearing no. 10332/16 convicting the appellant herein.
2. The facts in brief are that the respondent no. 1( complainant before the Ld. Trial Court ) filed complaint case bearing no. 10332/16 against the appellant herein( accused before Ld. Trial Court ) for the offence under section 138 of Negotiable Ishwar Singh Vs Poonam Gupta & Anr.
Instrument Act . The complainant pleaded that she is the proprietor of M/s Bhavya Enterprises and running the said business at F-103, First Floor, Adtiya Chamber-I, D Block, Central Market, Prashant Vihar, Delhi. The accused and his wife are very well known to the family of the complainant. Accordingly, the accused took the loan of Rs. 10,00,000/- from the complainant on 18.04.2014 at the interest of 18% p.a. for a period of around 1 - 1 ½ year. He also executed a promissory note and a receipt in favour of the complainant on 18.04.2014. After the lapse of the said period, the complainant demanded the principal amount and the accused thereupon in lieu of discharge of his legal liability issued the impugned cheque bearing no. 337750 dated 26.11.2015 for a sum of Rs. 10,00,000/- drawn on Andhra Bank, Rohini Branch, New Delhi-110085. The request was though made by accused not to present the said cheque as the payment was yet to be received by him from some other person. But after receiving no response from the accused, the complainant presented the cheque for enchashment in February' 2016 with her banker Indian Overseas Bank, Prashant Vihar, Delhi but the same was returned unpaid with the remarks 'Account Blocked' vide return memo dated 18.02.2016. The complainant accordingly, informed the accused about the dishonour of the cheque and requested to make the payment but accused avoided to made any payment. Accordingly, the complainant was constrained to issue legal demand notice dated 16.03.2016 through registered AD calling him to make the payment within 15 days. The notice was duly served upon him but he neither complied with the notice nor made any payment.
Ishwar Singh Vs Poonam Gupta & Anr.
Accordingly, the complainant ( respondent no. 1 herein )preferred the complaint for the prosecution of the accused ( appellant herein ) for the offence under section 138 of NI Act.
3. The cognizance upon same was taken by the Ld. Trial Court vide order dated 30.04.2016 and accused was summoned to face the trial. The accused, thereafter, appeared and moved the application u/s 145 (2) NI Act so as to contest the present matter. The notice in terms of Section 251 Cr. PC was served upon the accused on 10.01.2017 wherein the accused pleaded not guilty and claimed that the cheque in question was lost by him and the complainant somehow found it and is misusing the same. He has also filed NCR dated 31.08.2015 in this regard. He has not taken any loan from the complainant and has thus, no liability.
4. The matter was thereafter put on trial and CW-1 Surender Kumar Gupta, Special Power of Attorney holder on behalf of the complainant entered into witness box as a sole witness. He tendered his evidence by way of affidavit Ex. CW-1/A and placed reliance upon documents Ex. CW-1/1 to Ex. CW-1/8. He was extensively cross examined on behalf of the accused.
5. The statement of the accused was thereafter recorded under section 313 Cr. PC wherein the accused reiterated his defence regarding the cheque in question having lost by him on 31.08.2015 and the NCR( lost report ) being lodged with PS Prashant Ishwar Singh Vs Poonam Gupta & Anr.
Vihar. He has no liability towards the complainant. The promissory note and disputed cheque are forged and fabricated documents . The accused thereafter, in order to prove his defence entered into the witness box and was examined as DW-1. He reiterated his defence regarding the cheque having lost and he having lodged the NCR with PS Prashant Vihar. He was thereafter extensively cross examined on behalf of the complainant.
6. The Ld. Trial Court after hearing the parties found the appellant herein to be guilty for the offence under section 138 NI Act and sentenced him for simple imprisonment for 1 ½ years and a fine of Rs. 20,00,000/-.
7. The said impugned judgment has been challenged on behalf of the appellant on the following grounds :
a) The impugned judgment and sentence have been passed without application of legal mind, appreciation of facts and the same being illegal and arbitrary. There are several clerical mistakes in the judgment which reflect that the judgment has been passed in haste and without application of mind.
b) The Ld. Trial Court has failed to consider the fact that the complainant / respondent no. 1 never entered into witness box and her version therefore, has not come on record despite she being available . Her plea of illness is a false plea just to avoid cross examination . The evidence given on her behalf by CW-1 on the basis of notarized Ishwar Singh Vs Poonam Gupta & Anr.
Special Power of Attorney is legally not admissible and therefore the case of the complainant has remained unproved.
c) The Ld. Trial Court has further failed to consider the fact that the complainant failed to prove that the appellant/accused first of all required huge loan of Rs. 10 lac and secondly, the capacity of the complainant to disburse the said huge amount and that too in cash. The onus of proving the financial capacity to lend the loan amount was upon the complainant which she has failed to discharge.
d) The Ld. Trial Court has failed to consider the fact that the mandatory condition of service of legal demand notice was not met and therefore, the appellant could not have been convicted for the offence under section 138 NI Act.
e) The Ld. Trial Court has also failed to consider or appreciate the defence evidence produced by the appellant herein who entered into the witness box as DW-1. The documentary evidence produced by the appellant herein in support of his defence too has been ignored by the Ld. Trial Court. The testimony of DW-1 proves the defence of the appellant herein on the standard of preponderance of probabilities which he was supposed to do so under the law.
8. Hence, prayer is made for setting aside the impugned judgment.
9. The Ld. Counsel for the appellant in support of the said grounds of appeal Ishwar Singh Vs Poonam Gupta & Anr.
argued that the first legal aspect which the complainant was supposed to prove was the existence of legal debt and liability. The second being the proof of issuance of cheque in favour of the complainant / respondent no. 1 herein. On both the said aspects, the complainant has failed to prove her case as she never entered into the witness box and the bank documents or ITR documents does not at all prove the advance of loan as alleged. The entire transaction has been alleged to be carried out in cash which is illegal . The purported promissory note and the receipt produced by the complainant in support of her case has remained unproved as first of all she never entered into the witness box and secondly there being no expert evidence. The accused has categorically denied the authenticity of the said two documents and therefore, the onus was upon the complainant to prove the same through expert evidence. Lastly, it is argued that the Special Power of Attorney in favour of CW-1 Surender Kumar Gupta who is the sole witness examined on behalf of the complainant is not a valid piece of document. The same is silent as to the personal knowledge of the attorney holder. The Ld. Counsel for appellant in support of the said contentions placed reliance upon following judgments :-
1. Kumaran Vs State of Kerala & Anr passed by the Hon'ble Supreme Court of India in Criminal Appeal no. 896-897 of 2017 ;
2. M/s Pandiyan Finance Vs K. Periyasamy passed by the Hon'ble High Court of Judicature at Madras in Crl A. No. 62 of 2016 ;
3. Ram Vs Mahavir Nagri Co-op Society Ltd, passed by the Hon'ble High Court of Judicature at Bombay Bench at Aurangabad in Crl writ petition no. 1322 of 2019 ;
4. Birender Shukla Vs State & Anr passed by the Hon'ble High Court of Delhi in Crl Ishwar Singh Vs Poonam Gupta & Anr.
M.C. No. 2605 of 2019 ;
5. Surinder Singh Deswal @ Col. S.S. Deswal & Ors Vs Virender Gandhi & Anr in Crl Appeal no. 1936-1963 of 2019 ;
6. K. Subramani Vs K. Damodara Naidu, (2015) 1 Supreme Court Cases 99 ;
7. C. Santhi Vs Mary Sherly 2012 (1) JCC (NI) 43 and ;
8. M/s Sekhon and Sekhon Finance and Investment Company Vs Rani in CRM A 212-MA of 2012.
10. Per contra, Ld. Counsel for the respondent no. 1 vehemently opposed the present appeal by arguing that there is no legal infirmity in the impugned judgment or order on sentence. As far as the issue of competence of CW-1 to depose on behalf of the complainant is concerned, it is argued that he in his affidavit in evidence Ex. CW-1/A has categorically stated that he has personal knowledge about all the transactions which took place between the parties as he was present at the time of advance of loan or issuance of cheque in question. Therefore, the case of the complainant stands duly proved through the version given by CW-1 Surender Kumar Gupta who is a competent witness.
11. It is further argued on behalf of the respondent no. 1 that the promissory note and the receipt which are too vital piece of evidence also proves the case of the complainant regarding advance of loan of Rs. 10 lac are not denied in the entire defence evidence led on behalf of the appellant. Not a single word was uttered by the DW-1 qua the authenticity of both the said documents. Similarly, the authenticity of the said two documents is also not seriously challenged in the cross examination of CW-1. In support Ishwar Singh Vs Poonam Gupta & Anr.
of the arguments, the reliance is also placed on the following judgments :
1. A.C. Narayanan Vs State of Maharashtra & Anr passed by the Hon'ble Supreme Court of India in Criminal Appeal no. 73 of 2007 decided on 13.09.2013 ;
2. Rangappa Vs Sri Mohan passed by the Hon'ble Supreme Court of India in Criminal appeal no. 1020 of 2010 decided on 07.05.2010 ;
3. Bir Singh Vs Mukesh Kumar passed by the Hon'ble Supreme Court of India in Criminal Appeal no. 230-231 of 2019 decided on 06.02.2019 ;
4. Krishna P. Morajkar Vs Joe Ferrao & Anr passed by the Hon'ble Bombay High Court in criminal appeal no. 6 of 2012 decided on 19.07.2013 ;
5. M. Valsan @ Wilson Vs State of Kerala & Anr. Passed by the Hon'ble Kerala High Court in Crl Rev Petition no. 244 of 2020.
12. Before coming to the facts of the present case, the legal proposition qua the liability of the accused in a case under section 138 NI Act in light of the presumptions under Section 118 and 139 of NI Act requires to be considered. In this regard, the scope of the said presumptions and manner in which the said presumptions can be rebutted has been dealt with by the Hon'ble Supreme Court in a landmark case titled as Basalingappa Vs Mudibasappa, (2019) 5 SCC 418 and the legal position has been summarized in following manner :-
"23. We having noticed the ratio laid down by this Court in above cases on Sections 118 (a) and 139, we now summarise the principles enumerated by this court in following manner :-
(i) Once the execution of cheque is admitted Section 139 of the Act mandates a presumption that the cheque was for the Ishwar Singh Vs Poonam Gupta & Anr.
discharge of any debt or other liability.
(ii) The presumption under Section 139 is a rebuttable presumption and the onus is on the accused to raise the probable defence. The standard of proof for rebutting the presumption is that of preponderance of probabilities.
(iii) To rebut the presumption, it is open for the accused to rely on evidence led by him or accused can also rely on the materials submitted by the complainant in order to raise a probable defence. Inference of preponderance of probabilities can be drawn not only from the materials brought on record by the parties but also by reference to the circumstances upon which they rely.
(iv) That it is not necessary for the accused to come in the witness box in support of his defence, Section 139 imposed an evidentiary burden and not a persuasive burden.
(v) It is not necessary for the accused to come in the witness box to support his defence.
13. In light of the abovesaid settled legal position, the first issue which requires to be considered is as to whether the execution of the cheque is proved or admitted whereupon the presumption under section 139 and 118 of NI Act would come into picture. Therefore , the first factual issue which requires to be considered is whether the version given by CW-1 Surender Kumar Gupta proves the issue of execution of the cheque Ex. CW-1/4 or not .
14. Before proceeding further on the said issue, the legal issue qua the admissibility of his evidence requires to be considered as the appellant has challenged his competence to depose on behalf of the complainant herein. It is argued on behalf of the Ishwar Singh Vs Poonam Gupta & Anr.
appellant that the Special Power of Attorney in his favour is silent with respect to the fact of he having personal knowledge about the facts of the case and hence, he is an incompetent witness. The trial court record reflects that the complainant filed the application for permission to appear through her attorney Surender Kumar Gupta as she was suffering from various diseases. The said application was moved after the summoning of the accused when the matter was put on trial. The application was taken up on 15.05.2017 though the accused was absent on that day. The same was allowed. But the said order never challenged or questioned . Even thereafter, no objection was taken on behalf of the accused when he entered into the witness box as CW-1. The issue as to whether the power of attorney holder is a competent witness to depose on behalf of the principal or a complainant in a case under section 138 NI Act stands settled by the Hon'ble Supreme Court in a constitutional bench judgment in case titled as A.C. Narayanan Vs State of Maharashtra & Anr (supra). The relevant para is reproduced as under : -
"26 (ii). The Power of Attorney holder can depose and verify on oath before the court in order to prove the contents of the complaint. However, the power of attorney holder must have witnessed the transaction as an agent of the payee / holder in due course of possess due knowledge regarding the said transactions".
Ishwar Singh Vs Poonam Gupta & Anr.
15. Thus, in view of the said well settled legal proposition, the issue as to whether CW-1 Surender Kumar Gupta was a competent witness to depose on behalf of the complainant or not is to be seen in light of the evidence given by him in his affidavit Ex. CW-1/A. In para no. 2 of the said affidavit, he categorically deposed that he is looking after the said business of M/s Bhavya Enterprises whose proprietor is the complainant herein and has full knowledge about all the facts and circumstances of the present case. He further deposed that even the promissory note and receipt were executed in his presence and he even filled the said documents. He is even the signatory to the said promissory note Ex. CW-1/2 as a witness . Apart from the said facts, he also reiterated the fact of issuance of cheque in question and thereafter request having been made by the accused repeatedly not to present the cheque and wait for his response. On the abovesaid aspects regarding the personal knowledge of CW-1 , there is no worthwhile challenge in the entire cross examination on behalf of the complainant herein except a bald denial in the form of suggestions. Therefore, it has to be held that CW-1 was a competent witness to depose on behalf of the complainant having knowledge about all the material facts qua the relationship between the parties as well as the issuance of impugned cheque and other documents. Further the argument of Special Power of Attorney being silent as the authority to depose on behalf of principal , is also against the true import of its content. The para-1 of SPA Ex.CW-1/1 specifically authorises the CW- 1 to appear in the Court as well as file any affidavit or give any statement. Therefore, the Ishwar Singh Vs Poonam Gupta & Anr.
argument on behalf of the appellant that the SPA is silent as to the authority to depose is against the contents of the same.
16. Now coming to the aspect as to whether the complainant has been able to prove the execution of the impugned cheque Ex. CW-1/4. CW-1 categorically deposed in this regard and further in his further examination he deposed that all the particulars including the signatures except the name were filled by the appellant herein in his presence only. The said version of the complainant is not seriously challenged in the entire cross examination except to the fact that the signed cheque in question has been stolen. On the aspect of handwriting, DW-1 / appellant in the cross examination claimed that the cheque Ex. CW-1/4 only bears his signatures and he has not filled the contents of the same. The said version on behalf of the appellant appears to be false one. The signatures, the date of the cheque as well as the amount's column, all are in same handwriting with the same pen being used. Thus, it has to be held that the complainant / respondent no. 1 through the version of CW1 discharged the initial onus upon her regarding the execution of the instrument by the accused and the same having been issued in her favour.
17. The onus thereupon shifted upon the appellant in light of the legal proposition under section 118 (a) and 139 of NI Act to prove that the said cheque being not issued in discharge of legal debt / liability or the same having been misused as is the defence. The Ishwar Singh Vs Poonam Gupta & Anr.
accused( appellant herein ) in order to discharge the said onus placed upon him has taken three fold defence. The first limb of the defence is that the said signed cheque was lying at his shop and the same was lost for which he lodged NCR at PS Prashant Vihar on 31.08.2015. The said defence has been taken by him consistently since the issuance of notice in terms of section 251 Cr. PC. But the said defence of the appellant herein stands rebutted through his own document Mark A which is the NCR report . As per the contents of the said NCR report, the date and time of lost document has been shown to be 24.08.2015 at about 17.30 hrs and not 30.08.2015 or 31.08.2015 as is the defence of the accused herein. Further the cross examination of DW-1 on the said aspect is also relevant which again puts a big question mark over the said claim. He admitted to the fact that despite coming to know about the fact of misuse of the said cheque and it being stolen by the complainant herein, he has not preferred a single complaint to any authority till date qua the said theft. It is a unnatuaral conduct . Further, he claimed that he used to keep one or two blank signed cheques in his drawer at the shop for ensuring timely payment of the STD connection installed at his shop. Again the said version of the appellant herein is rebutted by NCR Mark A which reflect that the report lodged by him is qua three cheques bearing no. 337748, 337749 and 337750, one of which is the impugned cheque herein.
18 It is also quite apparent from the testimony of the DW-1 that despite losing the said three signed blank cheques on 30.08.2015 or 31.08.2015, he did not care to report Ishwar Singh Vs Poonam Gupta & Anr.
the said matter to his bank and never asked for stop payment. The said conduct on part of the appellant again raised a big question mark over his claim of lost cheque and the same having been misused by the complainant.
19. The second limb of defence is that there was no loan transaction between the parties herein and therefore, the appellant having no obligation to pay any amount to the respondent herein. To support the said version, the appellant primarily has placed reliance upon the version given by CW-1 who claimed that the entire transaction was in cash. The source of loan amount which is a huge amount of Rs. 10,00,000/- being not proved and lastly the promissory note and the receipt Ex. CW-1/1 and Ex. CW-1/2 being not proved. The issue of source of the loan amount has to be considered in light of the version given by CW-1 in his cross examination. He claimed that he paid the said amount in cash and the said loan amount was arranged by him through bank withdrawal from the bank account of M/s Bhavya Enterprises. Apart from that CW-1 also placed reliance upon their income tax return for the financial year 2014-15 Ex. CW-1/B-1 and Ex. CW-1/B-2. As far as the first aspect of the loan amount being arranged through bank withdrawal, the complainant has proved on record the bank statement Ex. CW-1/B-4. The said document is not challenged in the entire cross examination nor its mode of proof. The said statement of account reflects cash withdrawal of various amounts starting w.e.f. 03.04.2014 till 17.04.2014. The loan in question has been advanced on 18.04.2014. Thus there is no reason to disbelieve or discard the said account statement which reflect Ishwar Singh Vs Poonam Gupta & Anr.
that complainant was having sufficient amount in her hands through various cash withdrawals during the said relevant point of time.
20 The other documentary evidence on the said aspect is the ITR Ex CW1/B-1. But qua the same , it was argued on behalf of the appellant that the same has not been proved as per law. The said argument is also liable to be rejected as no such objection was taken as to mode of proof when the said documents came on record during the cross examination of CW-1 . The said ITR too reflects that M/s Bhavya Enterprises had advanced unsecured loans as per Annexure Part A in the financial year 2014-15. Apart from that the balance sheet of the said financial year too records the sundry debtors amount to be Rs. 43,857,43/-. Thus, the said documents which are unchallenged and unrebutted too does not in any manner probalises the defence of the appellant regarding there being no loan transaction between the parties and the cheque being issued without any legal debt or liability.
21 Apart from the said documentary evidence, the complainant has also proved on record promissory note Ex. CW-1/3 and receipt Ex. CW-1/2 executed by the appellant herein in favour of the complainant. The said promissory note has been proved on record by CW-1 who is also witness to the said document having being prepared in his presence as well as he having signed the same as witness. Apart from the bare denial in the cross examination as to the authenticity of the said two documents, there is nothing in the cross Ishwar Singh Vs Poonam Gupta & Anr.
examination which puts any question mark over the execution of the same. Similarly, the appellant in his statement under section 313 Cr. PC simply claimed that it is incorrect without giving any explanation . Further the appellant while entering into the witness box as DW-1 remained completely silent qua both the said documents . He did not utter a single word as to the authenticity of the said two crucial documents. In the cross examination, he was confronted with the said documents wherein he claimed that the same does not bear his signatures. So the onus was upon the accused / appellant to show that the said documents are forged and fabricated. But there is no material on record which proves any forgery or manipulation. On the contrary, complainant has proved on record the said documents through the version of CW-1 Surender Kumar Gupta who is also witness to the said Promissory note Ex. CW-1/3. Thus,the said documents also clinches the case of the respondent herein and reflect the loan transaction between the parties herein in lieu of which the impugned cheque having been issued. 22 The judgments on the aspects of legal debt or liability or discharge of onus relied upon by the appellant in support of his arguments are not applicable to the case in hand being distinguishable on facts.
23 The last argument advanced on behalf of the appellant the legal demand notice not being served upon him prior to the institution of the present complaint and hence the complaint being not maintainable is also against the record. The complainant Ishwar Singh Vs Poonam Gupta & Anr.
has proved on record the legal demand notice Ex.CW-1/6 dated 16.03.2016 which has been issued within the stipulated period of 30 days of dishonour of the cheque. Ex.CW- 1/7 is the Registered Cover receipt of the said legal demand notice sent to the said appellant. The said legal notice has been sent through RC to the very same address which finds mention in the complaint preferred before the Ld. Trial Court. Therefore, the presumption in terms of Section 27 of General Clauses Act has to be drawn regarding due service of postal article. Apart from that, the complainant has also proved on record the tracking report of said postal article Ex.CW-1/8 which is unchallenged as to the mode of proof, which too reflects due service. Therefore, the said argument on behalf of the appellant stands rejected.
24. In view of the aforesaid reasons,I am of considered opinion that the appellant has failed to prove his defence on the standard of preponderance of probabilities. There is no legal infirmity in the order of the Ld. Trial Court convicting the appellant herein for the offence u/s 138 of NI Act .
25. In light of the abovesaid discussion, the present appeal petition stands dismissed.
Announced in the open Court (Gagandeep Singh)
on 16.11.2021 ASJ/Spcl. Judge (NDPS):
North, Rohini Courts, Delhi